Phagocytosis is one of the key functions of retinal pigment epithelium (RPE) cells, which maintain photoreceptor health by removing photoreceptor outer segments (POSs) that are regularly shed. A deficiency in RPE function to phagocytose POSs may lead to vision loss in inherited retinal diseases and eventually to age-related macular degeneration (AMD) with geographic atrophy. Significant progress has been made in the field of cell replacement therapy for AMD using stem-cell-derived RPE. To test their function, RPE cells are incubated with purified bovine POSs for the demonstration of efficient binding, internalization, and digestion of POSs. Here, we present an image-based method to measure phagocytosis activity by using POSs labeled with a pH-sensitive fluorescent dye, which has low fluorescence at neutral pH outside of the cell and high fluorescence at low pH inside the phagosome. Further, we introduce a unique flow-cytometry-based method for the characterization of POSs by measuring specific markers for POSs such as rhodopsin and opsin. Using this method, we demonstrated a comparable quality of several bovine POS isolation batches and a reliable assessment of POS quality on RPE phagocytosis assay performance when subjected to different stress conditions. This work provides new tools to characterize POSs and insight into RPE phagocytosis assay development for the functional evaluation of RPE cells in the field of cell replacement therapy.