Diabetic retinopathy (DR), a complex complication of diabetes mellitus (DM), is a leading cause of adult blindness. Hyperglycemia triggers DR, resulting in microvascular damage, glial apoptosis, and neuronal degeneration. Inflammation and oxidative stress play crucial roles during this process. Current clinical treatments for DR primarily target the advanced retinal disorder but offer limited benefits with inevitable side effects. Extracellular vesicles (EVs) exhibit unique morphological features, contents, and biological properties and can be found in cell culture supernatants, various body fluids, and tissues. In DR, EVs with specific cargo composition would induce the reaction of receptor cell once internalized, mediating cellular communication and disease progression. Increasing evidence indicates that monitoring changes in EV quantity and content in DR can aid in disease diagnosis and prognosis. Furthermore, extensive research is investigating the potential of these nanoparticles as effective therapeutic agents in preclinical models of DR. This review explores the current understanding of the pathological effects of EVs in DR development, discusses their potential as biomarkers and therapeutic strategies, and paves the way for further research and therapeutic advancements.