Diabetes is now regarded as an epidemic, with the population of patients expected to rise to 380 million by 2025. Tragically, this will lead to approximately 4 million people around the world losing their sight from diabetic retinopathy, the leading cause of blindness in patients aged 20 to 74 years. The risk of development and progression of diabetic retinopathy is closely associated with the type and duration of diabetes, blood glucose, blood pressure, and possibly lipids. Although landmark cross-sectional studies have confirmed the strong relationship between chronic hyperglycaemia and the development and progression of diabetic retinopathy, the underlying mechanism of how hyperglycaemia causes retinal microvascular damage remains unclear. Continued research worldwide has focussed on understanding the pathogenic mechanisms with the ultimate goal to prevent DR. The aim of this paper is to introduce the multiple interconnecting biochemical pathways that have been proposed and tested as key contributors in the development of DR, namely, increased polyol pathway, activation of protein kinase C (PKC), increased expression of growth factors such as vascular endothelial growth factor (VEGF) and insulin-like growth factor-1 (IGF-1), haemodynamic changes, accelerated formation of advanced glycation endproducts (AGEs), oxidative stress, activation of the renin-angiotensin-aldosterone system (RAAS), and subclinical inflammation and capillary occlusion. New pharmacological therapies based on some of these underlying pathogenic mechanisms are also discussed.