To widen the alignment tolerance of a 10 Gbytes/s InGaAs p-i-n photodiode, which typically only has an optical coupling aperture of 30 μm in diameter, we have developed a self-positioning ball-lens-on-chip scheme for enlarging the effective coupling aperture. According to the measured results, the 4.5- and 5.3-fold improvements along the transverse and optical axes, respectively, in alignment tolerance have been demonstrated without sacrificing the diode efficiency as a commercially available ruby micro-ball-lens (MBL) with a 300 μm lens diameter integrated on the high-speed photodiode. To further explore the aperture enlargement capability and optimize the structural design, we have constructed a ray trace model based on the Monte Carlo method for the optical coupling system as well. Using this well-constructed simulation model, we further predict that, by integrating a 250 μm diametric ruby MBL on the photodiode with a 20 μm high lens socket, the alignment tolerance can have 7.1- and 10-fold improvements along the transverse and optical axes, respectively. Such a large alignment tolerance permits the usage of conventional passive scheme for photodiode package.