G'day Kyrill,
The LED is forward biased and conducts and gives out light on one half cycle and is reverse biased on the other half cycle.
The problem with this is that the reverse breakdown voltage of the LED is very low. You therefore need a power diode (a 1N4007 or similar) in series with the LED to handle the reverse voltage and protect the LED on the non-conducting half cycle.
So from the Active side:
1) Current Limiting Resistor - for 230V AC a 47K will give a bright LED, 100K for less brightness
2) Other end of resistor to anode of 1N4007 power diode
3) cathode of 1N4007 to anode of the LED
4) Cathode of the LED to Neutral
Cheers,
Ginger