Background Premature newborns are susceptible to retinopathy of prematurity (ROP), a vasoproliferative disease of the developing retinal vessels, which is a major cause of potentially avoidable blindness. Due to geographical variations in newborn care, geographic variations in the epidemiology of ROP have been observed internationally during the last several decades. There was a correlation between the severity of the condition and the number of prenatal, postnatal, and other risk factors. This study aimed to examine the incidence and risk factors associated with retinopathy of prematurity in preterm infants. Methods A retrospective review of preterm newborns evaluated for retinopathy of prematurity between January 2016 and December 2022 was carried out at King Fahd Hospital of the University (KFHU), Khobar, Saudi Arabia. Infants who fulfilled the screening criteria (GA < 34 or Birth Weight (WT) ≤ 1500 g) underwent the screening test, and the International Classification of Retinopathy of Prematurity was used to classify retinopathy of prematurity. Risk factors and demographic information regarding ROP were assessed. Statistical analysis was performed using SPSS (version 20) with a 95% confidence interval (CI). Statistical significance was set at p < 0.05. Results Among the 200 preterm neonates that were evaluated and admitted to neonatal critical care units, 37% exhibited premature retinopathy, with 46.7% of those cases being in stage 1. The development of ROP was linked to gestational age, length of mechanical ventilation, septicemia, intraventricular hemorrhage, bronchopulmonary dysplasia, respiratory distress syndrome, and septicemia, according to univariate and multivariate logistic regression analyses. Conclusion The incidence of total retinopathy in premature infants in this population was 37%. Evaluating these risk factors during the screening of high-risk premature infants will help determine the appropriate timing of examinations and treatment.