Somatostatin (SST) is abundantly produced by the human retina, and the main source is the retinal pigment epithelium (RPE). SST exerts relevant functions in the retina (neuromodulation, angiostatic, and anti-permeability actions) by interacting with SST receptors (SSTR) that are also expressed in the retina. In the diabetic retina, a downregulation of SST production does exist. In this article, we give an overview of the mechanisms by which this deficit of SST participates in the main pathogenic mechanisms involved in diabetic retinopathy (DR): neurodegeneration, neovascularization, and vascular leakage. In view of the relevant SST functions in the retina and the reduction of SST production in the diabetic eye, SST replacement has been proposed as a new target for treatment of DR. This could be implemented by intravitreous injections of SST analogs or gene therapy, but this is an aggressive route for the early stages of DR. Since topical administration of SST has been effective in preventing retinal neurodegeneration in STZ-induced diabetic rats, it seems reasonable to test this new approach in humans. In this regard, the results of the ongoing clinical trial EUROCONDOR will provide useful information. In conclusion, SST is a natural neuroprotective and antiangiogenic factor synthesized by the retina which is downregulated in the diabetic eye and, therefore, its replacement seems a rational approach for treating DR. However, clinical trials will be needed to establish the exact position of targeting SST in the treatment of this disabling complication of diabetes.