We consider the problem of illumination control in a networked lighting system wherein luminaires have local sensing and actuation capabilities. Each luminaire (i) consists of a light emitting diode (LED) based light source dimmable by a local controller, (ii) is actuated based on sensing information from a presence sensor, that determines occupant presence, and a light sensor, that measures illuminance, within their respective fields of view, and (iii) a communication module to exchange control information within a local neighborhood. We consider distributed illumination control in such an intelligent lighting system to achieve presence-adaptive and daylight-integrated spatial illumination rendering. The rendering is specified as target values at the light sensors, and under these constraints, a local controller has to determine the optimum dimming levels of its associated LED luminaire so that the power consumed in rendering is minimized. The formulated optimization problem is a distributed linear programming problem with constraints on exchanging control information within a neighborhood. A distributed optimization algorithm is presented to solve this problem and its stability and convergence are studied. Sufficient conditions, in terms of parameter selection, under which the algorithm can achieve a feasible solution are provided. The performance of the algorithm is evaluated in an indoor office setting in terms of achieved illuminance rendering and power savings.