Introduction. Brachial–ankle pulse wave velocity (baPWV), an indicator of arterial stiffness, has been demonstrated to be associated with type 2 diabetes mellitus (T2DM) and its vascular complications. This study was aimed at investigating the correlations of baPWV with both the presence and severity of diabetic retinopathy (DR) at baseline and at exploring the predictive role of baPWV in the new onset/progression of DR in the follow-up analysis. Methods. The prospective cohort study recruited 2,473 Chinese patients with T2DM, of whom 663 participants were finally included in the follow-up analysis. The presence and grading of DR were performed by the modified Early Treatment Diabetic Retinopathy Study. Uni- or multivariate linear and logistic regression models and Cox proportional-hazards regression analysis were conducted. Results. Of 2,473 patients with T2DM at baseline, 734 individuals were assessed to have DR and further categorized into 630 with non-sight-threatening DR (NSTDR) and 104 with STDR. In addition to the positive relationship between increased baPWV and the presence of DR, multinominal logistic regression analysis revealed that higher tertiles of baPWV were significantly related to the NSTDR (T2:
OR
=
1.62
(1.22, 2.15),
p
<
0.001
, and T3:
OR
=
2.58
(1.86, 3.58),
p
<
0.001
) and STDR group (T3:
OR
=
3.87
(1.87, 8.02),
p
<
0.001
). During a follow-up (mean period of 16.4 months), 111 participants had new onset/progression of DR. The cox regressions showed that high baseline baPWV was correlated with increased risk of development/progression of DR (
HR
=
2.24
, 95% CI (1.24, 4.03),
p
=
0.007
, for T2 baPWV and
HR
=
2.90
, 95% CI (1.49, 5.64),
p
=
0.002
, for T3 baPWV) after adjustments for multiple factors. Conclusions. Our results demonstrated that baseline baPWV might be an independent predictor in new onset/worsening of DR, suggesting that increased arterial stiffness might be involved in the development of DR. Follow-up studies with a longer duration are needed.