Diabetes-induced xerophthalmia is a general metabolic disorder with high incidence and increased treatment difficulty. Our study aimed to explore the combined effect of traditional Chinese and Western medicines on diabetes-associated xerophthalmia. We recruited 60 diabetic xerophthalmia patients, and randomly assigned them to either the control (Western medicine treatment) or the experimental (combined treatment of traditional Chinese medicine and Western medicine) groups. Pre-treatment and post-treatment analyses were performed to assess the combined therapeutic effect of traditional Chinese and Western medicine on xerophthalmia-associated indicators. We found that the experimental group expressed reduced levels of IL-1, IL-8, and TNF-α (P < 0.05) as compared to the control group. Furthermore, the experimental group showed higher treatment efficacy as compared to the control group (85.00 vs 51.67% Z = 22.244, P < 0.05). In addition, break-up time (t = 20.582, P < 0.05) and tear section (t = 23.082, P < 0.05) was increased in the experimental group as compared to the controls. Lastly, it was found that the combined treatment of traditional Chinese and Western medicine effectively reduced corneal injuries, as indicated by reduced fluorescein staining. This study suggested that a combination treatment consisting of both traditional Chinese and Western medicines may be effective against xerophthalmia in diabetes, and that inflammatory factors are potential biomarkers to examine the treatment efficacy.