The use of satellite-borne large-footprint LiDAR (light detection and ranging) systems allows for the acquisition of forest monitoring data. This paper mainly describes the design, use, operating principles, installation and data properties of the new Laser Vegetation Detecting Sensor (LVDS), a LiDAR system designed and developed at the Academy of Forest Inventory and Planning (AFIP) and the Beijing Institute of Telemetry (BIT). Data from LVDS were used to calculate the mean height of forest trees on sample plots using data collected in the Hunan province of China. The results show that the full waveform data obtained by LVDS has the ability to accurately characterize forest height. The mean absolute percentage error of mean forest height per plot in flat areas was 6.8%, with a mean absolute deviation of 0.78 m. The airborne LVDS system provides prototype data sets and a platform for instrument proof-of-concept studies for China’s Terrestrial Ecosystem Carbon Monitoring (TECM) mission, which is an Earth remote sensing satellite due for launch in 2020. The information produced by LVDS allows for forest structure studies with high accuracy and coverage of large areas.