Diabetic retinopathy, a progressive disease, is the major cause of acquired blindness in the developed countries. Despite cutting-edge research in the field, the exact mechanism of this multifactorial disease remains elusive. Matrix metalloproteinases (MMPs) degrade extracellular matrix and play significant role in regulating intracellular homeostasis. In the pathogenesis of diabetic retinopathy, activation of gelatinase MMPs (MMP-2 and MMP-9) in the retina is an early event, and activated MMPs damage the mitochondria and augment retinal capillary cell apoptosis, a phenomenon which is observed before histopathology characteristic of diabetic retinopathy can be seen. MMPs are regulated by a number of different mechanisms including cleavage of their zymogens, regulation of their tissue inhibitors, and their gene expressions by transcriptional factors and epigenetic modifications. This chapter reviews the current literature about the role of MMPs in the development of diabetic retinopathy, and describes different mechanisms to regulate their activation. With evolving research implicating MMPs in both preneovascularization and neovascularization stages of diabetic retinopathy, they could be an attractive target to inhibit the development/progression of diabetic retinopathy, a disease which has potential to rob vision during the most productive years of a diabetic patient's life.