For practical applications of carbon dots (CDs), a major challenge is to prevent the notorious aggregation-caused quenching (ACQ) effect. Herein, a new type of CDs (CD1) has been developed that can transform from ACQ to an enhancement of fluorescence by aggregation-induced emission (AIE). The blue fluorescence of the CDs is suppressed by ACQ. However, this is accompanied by the phenomenon of AIE at a longer wavelength, resulting in the emergence and gradual enhancement of yellow fluorescence. The obtained CD1 solid powder shows a bright yellow emission with a photoluminescence quantum yield (PLQY) of 65%. The photoluminescence (PL) spectra, absorption spectra, and time-resolved PL decay curves indicate that Förster resonant energy transfer from dispersed CD1 particles to large CD1 agglomerations leads to the enhancement of yellow fluorescence. To exploit its high PLQY and strong AIE, CD1 is applied as a color-converting layer on blue light-emitting diode (LED) chips to fabricate white LEDs (WLEDs). The obtained devices show white light coordinates of (0.29, 0.38) and (0.32, 0.42), which are close to pure white light (0.33, 0.33), and luminous efficiencies of 97.8 and 93.9 lm·W-1 and show good stability. The low cost, easy fabrication, controllability, and favorable fluorescence properties signify that CD1 of AIE will have superior performance in a variety of applications.