The purpose of this study was to investigate the efficacy of recombinant human erythropoietin (rhEPO) in preventing and reversing dysfunction of retinal neurons and glial cells in early-stage streptozotocin (STZ)-induced diabetic rats. Two weeks after STZ [60 mg/kg body weight (b.w.), i.p.] injection, diabetic rats had been administered rhEPO (5000 IU/kg of b.w., i.p.) injection three times weekly for 2 weeks. The changes to the electroretinogram, retina ultrastructure, erythropoietin receptors (EPO-Rs) and the content of glutamate in retinas before and after the experiment in test and control groups were compared. The amplitudes of b-wave and oscillatory potentials (OPs) decreased at the end of the experiment in STZ-induced diabetic rats compared with the age-matched controls, whereas the amplitudes of b-wave and OPs showed no decrease in diabetic rats with rhEPO injection. Mitochondrial metamorphosis in ganglion cells occurred in STZ-induced diabetic rats but was not found in those rats with rhEPO treatment. EPO-Rs in retinas and the retinal glutamate of STZ-induced diabetic rats at the end of the experiment had increased obviously compared with rhEPO-injected diabetic rats. The abnormalities of retinal electrophysiological activity, ganglion cells with swollen mitochondria in the retinas, increased retinal glutamate and EPO-R in the retinas occurred early in the process of the disease course in diabetic rats. These aspects can all be improved by intraperitoneal administered rhEPO. The administration of rhEPO may be useful in the neural treatment of diabetic retinopathy at the early stage.