Diabetic retinopathy is a severe microvascular complication amongst patients with diabetes, and is the primary cause of visual loss through neovascularization. Betaine is one of the components of Fructus Lycii. In the present study, the effects of betaine on the expression levels of vascular endothelial growth factor (VEGF) and hypoxia-inducible factor (HIF)-1α in association with the Akt pathway were investigated in the retinas of streptozotocin (STZ)-induced diabetic rats using western blot and immunohistochemical analyses. The results of the present study revealed that the expression levels of VEGF, HIF-1α, and Akt were increased in the retinas of the STZ-induced diabetic rats. Betaine treatment attenuated this increase in VEGF and HIF-1α expression via suppression of diabetes-induced Akt activation in the retinas of the diabetic rats. The results suggested that betaine may potentially be used to delay the onset of complications associated with diabetic retinopathy via inhibition of retinal neovascularization in patients with diabetes.