High quality, bulk aluminum nitride substrates were used to obtain pseudomorphic AlxGa1‐xN layers with low dislocation density, smooth surfaces, and high conductivity. These layers were fabricated into mid‐ultraviolet light emitting diodes with peak wavelengths in the range of 240‐260 nm. From transmission electron microscope images, it was confirmed that the dislocation density in the n‐type Al0.7Ga0.3N layer is low with no dislocations in the field of view. The low dislocation density continued through the quantum wells and electron blocking layer. However, the lattice mismatch between the pseudomorphic AlxGa1‐xN layers and the p‐type GaN contact layer is high (approximately 2.4%) and the pseudomorphic growth could not be achieved for thick layers. Instead, a network of misfit dislocations was formed at the GaN/AlxGa1–xN interface, which relieved strain in the GaN layer. The threading dislocations did not appear to propagate into the active region and thus enable the achievement of high internal (IQE) and external quantum efficiencies (EQE) from the devices fabricated on low dislocation density pseudomorphic active layers. Values of EQE as high as 1.44% for a device emitting at 248 nm operated in pulsed mode were achieved. Devices were packaged in lead frame packages and achieved output powers of 45 mW at 1.5 A for a 257 nm device with a peak EQE of 0.8% at 200 mA when operated in pulsed mode. The thermal properties of the packaged devices limited high current performance in CW mode. (© 2011 WILEY‐VCH Verlag GmbH & Co. KGaA, Weinheim)