Diabetic Retinopathy (DR), a retinal illness that degenerates the retina and causes blindness, can be effectively treated with early detection and examination. Although expensive and unpleasant, manual retinography is the gold standard for DR diagnosis. Many Deep Learning (DL)-based algorithms have shown promise as deep learning (DR) diagnostic tools, performing similarly to human picture evaluation. These strategies work best with fine-tuned hyperparameters and huge databases. To develop Deep Inductive Transfer Learning-based Diagnostic Systems (DITL-DS) for Multiclass DR Severity Classification. The benchmark Indian Diabetic Retinopathy Image Dataset (IDRiD) is chosen first. Next, the dataset is pre-processed by proportionally scaling the image to 128*128 and using Convolutional Local Area Histogram Equalization (CLAHE). Third, the uneven class label dataset is balanced for efficiency. Fourth, a global average pooling layer and bottlenecking are added to five DITL models—Inception V3, ResNet34, EfficientNet B0, VGG16, and Xception—to compensate for information loss. Finally, we compare our improved approaches to five basic DITL classifiers. Our modified Xception model separates severity stages best, with an accuracy of 0.9840, precision of 0.9845, recall of 0.9650, AUC of 0.9979, and AUC-ROC of 0.9902. Precision, recall, and F1 scores are 0.97, 0.99, and 0.98 for stage0, 0.99, 1, and 1 for stage1, 0.98, 0.94, and 0.96 for stage2, 0.99, 0.99, and 0.99 for stage3, and 1, 1, and 1 for stage4. This may help clinicians objectively diagnose DR early. To ensure robustness, the model’s generalizability was validated using APTOS (Asia Pacific Tele-Ophthalmology Society).