Introduction:The increasing prevalence of diabetic retinopathy in developing countries has become a worldwide concern. This problem is preventable by timely diagnosis and treatment; however, in the majority of cases, patients attend the eye clinics very late because of a lack of specialists and travel difficulties. Running a teleophthalmology system would significantly help to manage this disease. Aim: This study seeks to assess the accuracy of the teleophthalmology system and its effect on reducing unnecessary referrals in Iran. Methods: This study was conducted on 125 diabetic patients. First, the patients were examined by a retina specialist using a slit lamp and, then, single-field digital photos were captured by a portable, low-cost fundus camera. The images were uploaded onto a website and, after two months, were assessed by two retina specialists and two general practitioners (GPs). Finally, the diagnoses based on the digital photos were contrasted with the diagnoses established through face-to-face visits as a gold standard. Results:Out of 125 diabetic patients, eight (6.4%) were removed because of low-quality images and a total of 117 were evaluated. The sensitivity and specificity of each retina specialist presented with the photographs produced success rates of 90% and 97% respectively when judged against the gold standard of face-to-face visits. The rates of sensitivity for retinopathy referrals from the retina specialists were 92% and 85%. The sensitivity and specificity of their diagnoses of clinically significant macular edema (CSME) were calculated at 93% and 100%. The rates of sensitivity for each GP were 95% and 93% and the level of specificity was estimated to be approximately 98% for both GPs. The diagnosis rate for GPs when viewing the photographs as opposed to hosting face-to-face visits was more than 90%. Generally, with the implementation of this system, between 40% and 55% of referrals were calculated to have been avoidable. Conclusion: Our results from the first-ever research conducted on this topic in Iran showed that the teleophthalmology system is extremely accurate, that it can prevent unnecessary referrals and that it is useful for locating treatable patients. The results of this study could be of assistance in the running and expansion of such systems throughout Iran and Kerman Province to reduce eye damage arising from diabetes, decrease avoidable referrals to clinics, increase the availability of specialist visits for people in remote and rural areas and optimize the use of clinical infrastructures for patients in emergencies.