Background: Diabetic retinopathy (DR) is one of the major complications of diabetes and the consequences often lead to loss of vision. Currently, the treatments for DR are expensive, not easily available and use of synthetic drugs leads to various toxic effects. Bioactive compound has been reported to be an alternative for treatment of DR due to its ability to target multiple pathophysiological signaling pathways. However, bioactive compound suffers from some inherent physicochemical characteristics which restricts their use as therapeutic agents. Objective: This review emphasizes on an overview of the bioactive agents which are delivered as nano-formulation for safe and effective ocular delivery for the treatment of DR. Additional focus include site specific ocular delivery with increased bioavailability to ensure highly efficacious treatment of DR. Results: Utilization of various bioactive compounds such as polyphenols, flavonoids, tannins etc. can counter balance the damages occurs in the retinal tissues and thereby may ameliorate DR progression. Encapsulation of these bioactive compounds in nanotechnology-based delivery system can improve the bioavailability, reduce toxic effect and achieve sitespecific ocular delivery. Conclusion: The pros and cons of bioactive compounds in treating DR and the use of nanotechnology to deliver bioactive compounds are discussed.