We propose a novel optical design to tailor the angular distribution of a micro-LED (µLED) display system and use vehicle display as an example to illustrate the design principles. The display system consists of a µLED array with a tailored LED structure, a small formfactor compound parabolic concentrator (CPC) system, and a functional engineered diffusor. It provides high efficiency, high peak brightness, and small formfactor. In the design process, a mix-level optical simulation model, including the angular distribution of polarized emission dipole (dipole emission characteristics), Fabry-Perot cavity effect (wave optics), and light propagation process (ray optics), is established to analyze the angular distribution of µLEDs. Such an optical design process from dipole emission to display radiation pattern can be extended to other µLED display systems for different applications.