Diabetic retinopathy is characterized by early onset of neuronal cell death. We previously showed that insulin mediates a prosurvival pathway in retinal neurons and that normal retina expresses a highly active basal insulin receptor/Akt signaling pathway that is stable throughout feeding and fasting. Using the streptozotocin-induced diabetic rat model, we tested the hypothesis that diabetes diminishes basal retinal insulin receptor signaling concomitantly with increased diabetes-induced retinal apoptosis. The expression, phosphorylation status, and/or kinase activity of the insulin receptor and downstream signaling proteins were investigated in retinas of age-matched control, diabetic, and insulin-treated diabetic rats. Four weeks of diabetes reduced basal insulin receptor kinase, insulin receptor substrate (IRS)-1/2-associated phosphatidylinositol 3-kinase, and Akt kinase activity without altering insulin receptor or IRS-1/2 expression or tyrosine phosphorylation. After 12 weeks of diabetes, constitutive insulin receptor autophosphorylation and IRS-2 expression were reduced, without changes in p42/p44 mitogen-activated protein kinase or IRS-1. Sustained systemic insulin treatment of diabetic rats prevented loss of insulin receptor and Akt kinase activity, and acute intravitreal insulin administration restored insulin receptor kinase activity. Insulin treatment restored insulin receptor-beta autophosphorylation in rat retinas maintained ex vivo, demonstrating functional receptors and suggesting loss of ligand as a cause for reduced retinal insulin receptor/Akt pathway activity. These results demonstrate that diabetes progressively impairs the constitutive retinal insulin receptor signaling pathway through Akt and suggests that loss of this survival pathway may contribute to the initial stages of diabetic retinopathy.