NBA all-time scoring leader James, who sparked the Cavaliers to their only NBA title in 2016 before joining the Lakers, has not committed to play beyond this season, his record 23rd in the league.
The 41-year-old superstar, a four-time NBA champion and four-time NBA Most Valuable Player, scored 11 points, passed off five assists, grabbed three rounds and made a steal in 27 minutes for the Lakers.
James, from nearby Akron, was cheered by a sellout crowd when introduced in the starting lineup and he covered his face to hide an emotional reaction when fans gave him a standing ovation during a special "welcome home" videoboard display.
"There are certainly always emotions for him coming back here," Lakers coach JJ Redick said. "During the tribute video you could see being back here is very important to him. There's a human element to all of this."
Mitchell understood that even with the Cavaliers winning their fifth consecutive game and improving to 29-20, this night belonged to James and his legacy of making Cleveland a champion after 52 years of failure in major US sports leagues.
"He has laid the foundation," Mitchell said. "He has done a lot for the city being from here. We want to replicate that.
"He deserves the energy he has got here. First time they have done it in 50-some years. We're trying to do it differently. At the end of the day, we're trying to find ways to go out there and bring the city another championship."
Jaylon Tyson added 20 points for the Cavs and De'Andre Hunter scored 19 off the Cleveland bench while Luka Doncic had a game-high 29 points for the Lakers (28-18), who also had eight points from Bronny James, LeBron's son.
"It was cool for him to have that moment here," teammate Gabe Vincent said.
James, who fell to 9-4 as a visiting player in Cleveland, had averaged 28 points a game in 24 prior contests against the Cavs, but was contained by Tyson defensively.
"I fear no man," Tyson said. "He's a great player and he was my challenge today. I'll take that challenge always."
Tyson took a swipe at James, declaring, "It's Donovan Mitchell's city now. When he comes back, we're going to make sure everybody roots for him like they did for (James). It's his show now."
The Cavs outscored the Lakers 42-22 in the third quarter for a 99-77 lead, hitting 7-of-11 shots from three-point range and 17-of-25 overall in the period.
"We came out the first five minutes with energy and reaped the benefits of that," Tyson said.
Lakers lacked 'juice'
"We got outplayed. I got outcoached," Redick said. "We just didn't look like we had all our juice."
The Cavs were without reigning NBA Defensive Player of the Year Evan Mobley due to a left calf strain, Mitchell said, adding that he and "phenomenal" Tyson had work ahead.
"With Evan out, there's going to be a lot more required of both of us," Mitchell said. "We're ready to step up and everybody do their jobs."
In other games, Cameroon's Pascal Siakam scored 20 points to lead host Indiana over Chicago 113-110 while Brandon Miller's 26 points led Charlotte in a 112-97 triumph at Memphis.
Paolo Banchero delivered 31 points and 12 rebounds for Orlando in a 133-124 victory at Miami.
Nickeil Alexander-Walker scored 21 points and Jalen Johnson added 19 points and 14 rebounds for Atlanta in a 117-106 triumph at Boston.
New York's Mikal Bridges scored 30 points, OG Anunoby added 26 points and Karl-Anthony Towns grabbed 22 rebounds in a 119-92 victory at Toronto, snapping the Raptors' four-game win streak.