The invention discloses a gallium nitride based light emitting diode and a manufacturing method thereof. In the invention, a double-layer transparent conducting layer structure is designed, a first transparent extension layer is formed on a p type semiconductor layer, a p electrode is provided at a center area of an epitaxial structure layer, peripheral of the p electrode is provided with a hole structure, and a second transparent extension layer is formed in the hole structure and is connected with an n electrode to form an equipotential surface. After current is injected from the p electrode, the current diffuses to a whole light emitting surface through the first transparent extension layer and flows to an n type layer through the p type semiconductor layer, and since the second transparent extension layer and the n electrode are in a same electric potential, the current diffuses to the second transparent extension layer to reach the n electrode finally. According to the gallium nitride based light emitting diode and the manufacturing method, in a process that the current flows to the n electrode from the p electrode, the current is uniformly distributed on an epitaxial luminescent layer, a current flow through path of a P layer is shorter, simultaneously, structure of partial light emitting surface is changed, and luminescence efficiency is effectively raised.