This study investigated the diagnostic performance, feasibility, and end-user experiences of an artificial intelligence (AI)-assisted diabetic retinopathy (DR) screening model in real-world Australian healthcare settings. The study consisted of two components: (1) DR screening of patients using an AI-assisted system and (2) in-depth interviews with health professionals involved in implementing screening. Participants with type 1 or type 2 diabetes mellitus attending two endocrinology outpatient and three Aboriginal Medical Services clinics between March 2018 and May 2019 were invited to a prospective observational study. A single 45-degree (macula centred), non-stereoscopic, colour retinal image was taken of each eye from participants and were instantly screened for referable DR using a custom offline automated AI system. A total of 236 participants, including 174 from endocrinology and 62 from Aboriginal Medical Services clinics, provided informed consent and 203 (86.0%) were included in the analysis. A total of 33 consenting participants (14%) were excluded from the primary analysis due to ungradable or missing images from small pupils (n = 21, 63.6%), cataract (n = 7, 21.2%), poor fixation (n = 2, 6.1%), technical issues (n = 2, 6.1%), and corneal scarring (n = 1, 3%). The area under the curve, sensitivity, and specificity of the AI system for referable DR were 0.92, 96.9% and 87.7%, respectively. There were 51 disagreements between the reference standard and index test diagnoses, including 29 which were manually graded as ungradable, 21 false positives, and one false negative. A total of 28 participants (11.9%) were referred for follow-up based on new ocular findings, among whom, 15 (53.6%) were able to be contacted and 9 (60%) adhered to referral. Of 207 participants who completed a satisfaction questionnaire, 93.7% specified they were either satisfied or extremely satisfied, and 93.2% specified they would be likely or extremely likely to use this service again. Clinical staff involved in screening most frequently noted that the AI system was easy to use, and the real-time diagnostic report was useful. Our study indicates that AI-assisted DR screening model is accurate and well-accepted by patients and clinicians in endocrinology and indigenous healthcare settings. Future deployments of AI-assisted screening models would require consideration of downstream referral pathways.