Diabetic eye disease represents a major cause of visual impairment and blindness globally, particularly among working-age adults. It encompasses a spectrum of ocular complications, with diabetic retinopathy (DR) and diabetic macular edema (DME) being the most prevalent and vision-threatening manifestations. The pathophysiology of diabetic eye disease is multifactorial, involving chronic hyperglycemia-induced oxidative stress, inflammation, and microvascular dysfunction, which collectively compromise retinal integrity. Additionally, diabetes increases the risk of cataract formation, primary open-angle glaucoma, and neovascular glaucoma, further contributing to visual morbidity. Early diagnosis is critical to preventing irreversible damage. Advances in retinal imaging, including optical coherence tomography (OCT) and ultra-widefield fluorescein angiography, have revolutionized the ability to detect and monitor subtle retinal changes. Effective management relies on strict systemic control of blood glucose, blood pressure, and lipids, as well as ocular-specific treatments. Intravitreal anti-vascular endothelial growth factor (anti-VEGF) agents have become the cornerstone of therapy for DME and proliferative DR, often replacing traditional laser photocoagulation. Surgical options remain essential for advanced complications such as vitreous hemorrhage and tractional retinal detachment. Systemic factors—including duration of diabetes, glycemic control, hypertension, dyslipidemia, and renal status—significantly influence disease progression. A multidisciplinary approach that integrates ophthalmologic and systemic care is essential to optimize visual outcomes and quality of life for diabetic patients. This review summarizes the current understanding of the epidemiology, pathophysiology, clinical features, diagnostic strategies, and contemporary management of diabetic eye disease, highlighting areas for ongoing research and improvements in patient care.