I am designing a PCB for some LEDs based off of the arduino nano. The LEDs I am using are 24 WS2812, and the microcontroller I am using is the ATmega328P-AU. I have the AMS1117-5.0 voltage regulator feeding power to the microcontroller. The whole circuit is meant to be powered by your computer via USB. Should the voltage regulator also power the LEDs, or can I bypass it? The AMS117 can supply up to 1.5 amps, which should be enough to power the whole circuit, but I want to be safe. Would a better idea be using a dedicated voltage regulator solely for the LEDs?
No. The AMS1117 is speced to allow up to 1.5 A only in specific circumstances, such as VIN being only 1.5V above Vout (So 5 + 1.5 = 6.5V In) and with sufficient cooling. The AMS1117 is a linear regulator so it basically acts like a giant resistor, so at ideal 1.5V drop out at 1.5A it's still putting out 3 Watts of heat. If you dont provide a proper heatsink then it wont be happy. Its typically a 1 Amp regulator and that's what all its descriptions say even in the datasheets first page.
For this circuit you either want to provide a regulated 5V in (aka any 2.1Amp usb power supply) or you ideally want a switching regulator (car usb adapters are ideal for this since they tend to take 7 to 24V in to 5V regulated out, depending on the IC it uses). Linear regulators are not great for your scenerio.
You could provide the led circuit it's own power regulator, in parallel to the microcontrollers regulator, or you can power both of them from the same regulator if you take the current and heat into account. Also make sure you add a nice cap at power for the LEDs, the rapidly changing power draw can cause the voltage to dip and cause brownouts for the LEDs or the microcontroller.