Cathode

In a device which consumes power (such as an LED) the cathode is negative, and in a device which provides power the cathode is positive.

A cathode is an electrode through which electric current flows out of a polarized electric device. This can be contracted with the anode in which current flows into the device.

A common misconception is that the cathode actually has always has a negative polarity. Electron flow always occurs from the anode to cathode. The misconception likely comes from the misunderstanding that in a device the consumes power, the cathode is negatively charged, and conversely, the cathode is positively charged in devices that provide power to the system.

This is an exception in the labeling of [[diode | diodes}] where the diode is always arranged according to forward current, regardless of diode function.

Chemistry
In chemistry, the cathode is the electrode of an electrochemical cell at which reduction (the addition of electron where the oxidation number decreases) occurs. The cathode suppliers the positively charged cations that move to it through the electrolyte with negatively charged electrons. The cathode is negative in electrolytic cells, and positive in  galvanic cells.

Electrolytic Cell
If an electrolytic cell the cathode is where negative polarity is applied to drive the cell. This process is knows a electrolysis. Such processes typically involve positively charged metal ions that leave behind pure metals as electrons are removed.

Galvanic Cell
If a galvanic cell the cathode is where positive polarity is applied to complete the circuit. In this case the anode of the cell gives off electrons which return to the cell by passing through the circuit and into the cathode.

Reference

 * http://en.wikipedia.org/wiki/Cathode