AMD (age-related macular degeneration) is a neurodegenerative disease causing irreversible central blindness in the elderly. Apoptosis and inflammation play important roles in AMD pathogenesis. PEDF (pigment epithelium-derived factor) is a potent neurotrophic and anti-inflammatory glycoprotein that protects the retinal neurons and photoreceptors against cell death caused by pathological insults. We studied the effects of PEDF on focal retinal lesions in DKO rd8 (Ccl2(-/-)/Cx3cr1(-/-) on C57BL/6N [Crb1(rd8)]) mice, a model for progressive, focal rd (retinal degeneration). First, we found a significant decrease in PEDF transcript expression in DKO rd8 mouse retina and RPE (retinal pigment epithelium) than WT (wild-type, C57BL/6N). Next, cultured DKO rd8 RPE cells secreted lower levels of PEDF protein in the media than WT. Then the right eyes of DKO rd8 mice were injected intravitreously with recombinant human PEDF protein (1 μg), followed by a subconjunctival injection of PEDF (3 μg) 4 weeks later. The untreated left eyes served as controls. The effect of PEDF was assessed by fundoscopy, ocular histopathology and A2E {[2,6-dimethyl-8-(2,6,6-trimethyl-1-cyclohexen-1-yl)-1E,3E,5E,7E-octatetra-enyl]-1-(2-hydroxyethyl)-4-[4-methyl-6(2,6,6-trimethyl-1-cyclohexen-1-yl) 1E,3E,5E,7E-hexatrienyl]-pyridinium} levels, as well as apoptotic and inflammatory molecules. The PEDF-treated eyes showed slower progression or attenuation of the focal retinal lesions, fewer and/or smaller photoreceptor and RPE degeneration, and significantly lower A2E, relative to the untreated eyes. In addition, lower expression of apoptotic and inflammatory molecules were detected in the PEDF-treated than untreated eyes. Our results establish that PEDF potently stabilizes photoreceptor degeneration via suppression of both apoptotic and inflammatory pathways. The multiple beneficial effects of PEDF represent a novel approach for potential AMD treatment.