"I give credit where credit is due," James told reporters, per Mark Medina of USA Today. "Denver played exceptionally well."
Denver led 63-53 at halftime and by as many as 20 points in the fourth quarter, but the Lakers stormed back to within three after a James layup cut the deficit to 101-98 with 5:26 remaining.
However, Denver surged back with a 10-1 run keyed by a pair of three-pointers from Jamal Murray, who finished with a team-high 28 points and 12 assists. With the win, Denver cut L.A.'s series lead to 2-1, with Game 4 set for Thursday at 9 p.m. ET.
The Nuggets were excellent on both ends of the court. They shot 54.8 percent from the field and hit 11 three-pointers compared to the Lakers' six from beyond the arc. Denver also got to the line seven more times and made nine more free throws.
Three Nuggets scored 22 or more, with Jerami Grant dropping a playoff career-high 26 on 7-of-11 shooting (10-of-12 from the free-throw line. Nikola Jokic shot an efficient 9-of-14 en route to his 22 points, and Monte Morris added 14 more points off the bench.
Even players who didn't shine offensively fared well. In particular, Paul Millsap, who scored just six points on 2-of-8 shooting, made a big impact elsewhere. Per Hardwood Paroxysm, he finished with a plus-19.8 rating. Millsap also held Davis to 1-of-7 shooting when he was his primary defender, per ESPN's Ohm Youngmisuk.
The Lakers shot 51.8 percent from the field but hit just 6-of-26 three-pointers. The Nuggets also out-rebounded L.A. 44-25, with Anthony Davis snatching two boards despite playing 43 minutes.
The Lakers' bench also had an off-night: Of note, Markieff Morris and Rajon Rondo each had a plus-minus of minus-13 on Tuesday.
Denver will now look to even the series on Thursday evening.