Modified grid laser photocoagulation has been shown to stabilize visual acuity in patients with diabetic macular edema, but the effect on extrafoveal visual function is uncertain. Automated static threshold perimetry was performed on 64 eyes of 36 patients before and after modified grid therapy with the argon green or krypton red laser. Twenty-eight eyes underwent two grid treatments for persistent macular edema. For all eyes tested, average threshold sensitivity in the central 5 degrees dropped 3.44 dB (standard deviation [SD], 3.79 dB) after the first treatment and 6.86 dB (SD, 5.02 dB) cumulatively after the second treatment. Qualitatively, the grayscale displays of the central visual field were darker after treatment, but the scotomata from laser photocoagulation could not be distinguished from those due to macular edema. The foveal threshold showed no significant change. In a subgroup of patients tested, color vision was not significantly improved and nearly all patients exhibited a tritan defect before and after treatment. No difference was detected between the argon and krypton groups. This suggests that with modified grid laser photocoagulation visual acuity and foveal threshold are preserved at the expense of generalized loss of threshold sensitivity across the central 10 degrees of the visual field.