We derive the form for an exact exchange energy density for a density decaying with Gaussian-like behavior at long range. Based on this, we develop the X3LYP (extended hybrid functional combined with Lee-Yang-Parr correlation functional) extended functional for density functional theory to significantly improve the accuracy for hydrogen-bonded and van der Waals complexes while also improving the accuracy in heats of formation, ionization potentials, electron affinities, and total atomic energies [over the most popular and accurate method, B3LYP (Becke three-parameter hybrid functional combined with Lee-Yang-Parr correlation functional)]. X3LYP also leads to a good description of dipole moments, polarizabilities, and accurate excitation energies from s to d orbitals for transition metal atoms and ions. We suggest that X3LYP will be useful for predicting ligand binding in proteins and DNA.