A high electron mobility transistor (HEMT)-compatible power lateral field-effect rectifier (L-FER) with low turn-on voltage is demonstrated using the same fabrication process as that for normally off AlGaN/GaN HEMT, providing a low-cost solution for GaN power integrated circuits. The power rectifier features a Schottky-gate-controlled two-dimensional electron gas channel between the cathode and anode. By tying up the Schottky gate and anode together, the forward turn-on voltage of the rectifier is determined by the threshold voltage of the channel instead of the Schottky barrier. The L-FER with a drift length of 10 μm features a forward turn-on voltage of 0.63 V at a current density of 100 A/cm2. This device also exhibits a reverse breakdown voltage (BV) of 390 V at a current level of 1 mA/mm and a specific on resistance (RON,sp) of 1.4 mΩ cm2, yielding a figure of merit (BV2/RON,sp) of 108 MW/cm2. The excellent device performance, coupled with the lateral device structure and process compatibility with AlGaN/GaN HEMT, make the proposed L-FER a promising candidate for GaN power integrated circuits.