Diabetic retinopathy is the most common microvascular complication of diabetes. Early clinical trials have established the efficacy and safety of laser in the treatment of proliferative diabetic retinopathy (PDR) and diabetic macular edema (DME). Despite timely and appropriate use of laser, some patients continue to experience visual loss. The pathogenesis of PDR and DME is multifactorial involving both angiogenic and inflammatory processes. Recent trials have shown that the anti-inflammatory and anti-angiogenic properties of corticosteroids may provide benefit in treating PDR and DME. The exact role of steroids in the treatment for diabetic retinopathy and macular edema remains to be fully elucidated.