Diabetic retinopathy (DR) is a vision-threatening complication that affects virtually all diabetic patients. Various treatments have been attempted, but they have many side effects and limitations. Alternatively, stem cell therapy is being actively researched, but it faces challenges due to a low cell survival rate. In this study, stem cells were pretreated with sirolimus, which is known to promote cell differentiation and enhance the survival rate. Additionally, the subconjunctival route was employed to reduce complications following intravitreal injections. Diabetes mellitus was induced by intraperitoneal injection of 55 mg/kg of streptozotocin (STZ), and DR was confirmed at 10 weeks after DM induction through electroretinogram (ERG). The rats were divided into four groups: intact control group (INT), diabetic retinopathy group (DR), DR group with subconjunctival MSC injection (DR-MSC), and DR group with subconjunctival sirolimus-pretreated MSC injection (DR-MSC-S). The effects of transplantation were evaluated using ERG and histological examinations. The ERG results showed that the DR-MSC-S group did not significantly differ from the INT in b-wave amplitude and exhibited significantly higher values than the DR-MSC and DR groups (p < 0.01). The flicker amplitude results showed that the DR-MSC and DR-MSC-S groups had significantly higher values than the DR group (p < 0.01). Histological examination revealed that the retinal layers were thinner in the DR-induced groups compared to the INT group, with the DR-MSC-S group showing the thickest retinal layers among them. Subconjunctival injection of sirolimus-pretreated MSCs can enhance retinal function and mitigate histological changes in the STZ-induced DR rat model.