ObjectiveChronic inflammation and oxidative stress mediate the pathological progression of diabetic complications, like diabetic retinopathy (DR), peripheral neuropathy (DPN) and impaired wound healing. Studies have shown that treatment with a stable form of arginase 1 that reduces l-arginine levels and increases ornithine and urea limits retinal injury and improves visual function in DR. We tested the therapeutic efficacy of PEGylated arginine deiminase (ADI-PEG20) that depletes l-arginine and elevates l-citrulline on diabetic complications in the db/db mouse model of type 2 diabetes (T2D). MethodsMice received intraperitoneal (IP), intramuscular (IM), or intravitreal (IVT) injections of ADI-PEG20 or PEG20 as control. Effects on body weight, fasting blood glucose levels, blood-retinal-barrier (BRB) function, visual acuity, contrast sensitivity, thermal sensitivity, and wound healing were determined. Studies using bone marrow-derived macrophages (BMDM) examined the underlying signaling pathway. ResultsSystemic injections of ADI-PEG20 reduced body weight and blood glucose and decreased oxidative stress and inflammation in db/db retinas. These changes were associated with improved BRB and visual function along with thermal sensitivity and wound healing. IVT injections of either ADI-PEG20, anti-VEGF antibody or their combination also improved BRB and visual function. ADI-PEG20 treatment also prevented LPS/IFNℽ-induced activation of BMDM in vitro as did depletion of l-arginine and elevation of l-citrulline. Conclusions/interpretationADI-PEG20 treatment limited signs of DR and DPN and enhanced wound healing in db/db mice. Studies using BMDM suggest that the anti-inflammatory effects of ADI-PEG20 involve blockade of the JAK2-STAT1 signaling pathway via l-arginine depletion and l-citrulline production.