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Light Radius is the radius in which the player sees his surroundings. This has been used in Diablo 2 but has been removed as an affix in Diablo 3.
In Diablo I, Light Radius was actually fairly useless, as whilst it allowed the player to see longer distances, it also meant monsters could see the player more easily as well. As such, it was to your advantage to have a lower light radius.
In Diablo II, Light Radius wasn't much more useful as most of the game occured in well lit above ground areas, and no one really cared about it much. Generally it was just a worthless weapon modifier.
In Diablo III, Light Radius has been removed as an affix on items[1]. Different light radii is now instead used to differentiate visual distinctions between areas.