Building codes commonly call for flame-retardant interior wall finishes. Drywall (aka sheetrock or gypsum board) is the most common around here (Canada).

Recently, foamed glass is becoming available for residential construction (although sadly not yet in north america).

Anyway. The idea is panels made of foamed glass, smooth or nicely textured, reinforced with fiber mesh, and fitted with LEDs that diffuse through the translucent material. The panel is multi-functional providing interior finish, fire resistance, and ambient lighting.

To provide more even distribution of light, rather than hot-spots at each LED, solid ribbons of glass fiber (light-pipe with core and cladding) could be embedded into the foam matrix.

The LEDs could be arranged along the bottom edge of panels to simplify the power supply, and the light-pipes would carry the light up the panel. The light-pipes could be arranged in bio-mimetic patterns such as grasses and trees. Imagine a hallway lined with glowing shrubbery.

Taping and finishing the panels would require special translucent materials.