Retinal ischemia and edema are the two major intraretinal components of diabetic maculopathy. Focal macular edema is caused by focal leakage from retinal microaneurysms and dilated capillary segments; diffuse edema is caused by leakage from diffusely dilated retinal capillaries throughout the posterior pole. Diffuse macular edema may be exacerbated by systemic factors such as cardiac or renal failure, and hypertension. It is postulated that dysfunction of the retinal pigment epithelial barrier and transport functions might contribute to the problem of diffuse macular edema. Newer techniques of laser grid photocoagulation for diffuse edema have been proposed. It is postulated that photocoagulative debridement of a disordered retinal pigment epithelium could be a mechanism of action of this treatment.