A visible light object ranging and detecting system utilising light emitting diodes (LEDs) is proposed and investigated. The LEDs are used not only as illuminating devices but also as ranging and detecting sensors. LED is intensity modulated with a predetermined sinusoid signal at a certain frequency with an initial phase. After propagation, the backscatter signals from the object are received and detected. The direction of the object is estimated by an optical imaging receiver. The distance between the object and the LED is obtained based on a differential phase-shift measurement. The theoretical model of the system is derived and evaluated, and the fundamental channel characteristics of the proposed system are simulated and analysed. The numerical results show that with a proper design, the presence or position of an object can be identified with a detection range of up to ~6 m, with an estimation error as small as ~5 cm for the system employing commercially available illumination LEDs.