Recent studies have sought to utilize diode laser "micropulsing" in order to preserve therapeutic efficacy of retinal photocoagulation while minimizing pain and subjacent tissue injury. A model for the transient thermal tissue response to continuous and micropulsed diode laser output is presented in order to understand the laser-tissue interactions and to generate optimum parameters for exploiting potential advantages of micropulsed application. The tissue thermal response was calculated by convolving the analytical solution to the three-dimensional, isotropic heat conduction equation with a source term corresponding to the spot size of the laser incident on the absorbing retinal pigment epithelium (RPE) and choroid layers of the ocular fundus. Thermal localization is quantitated by comparing the temperature rise in the RPE (T(RPE) and deep choroid (T(Ch). A 1-watt (average power), 20-microns diameter, 100 ms pulse (continuous or micropulsed) of 810 nm radiation was modelled to be incident on a geometric idealization of the human retina and choroid. A temperature gradient is rapidly established with only modest temperature augmentation between 10 and 100 ms. At 100 ms T(RPE) and T(Ch) are 32 and 23 C, respectively, for continuous application, and 41 and 27 C for 2 ms on/off micropulsed application. For a duty factor (total laser "on" time divided by pulse length) of 50%, T(RPE)/T(Ch) is maximal for a micropulse on/off duration of 2 ms; however, the variation over micropulse durations from 200 microseconds to 50 ms is small. In addition, whereas end-pulse T(RPE)/T(Ch) is greater for 2 ms on/off application when compared with continuous delivery (1.53 vs. 1.39), thermal relaxation during pulse quiescence in the micropulsed mode allows for an early increase in deep choroidal temperature with respect to T(RPE). For ten 200 microseconds pulses equally separated over 100 ms (duty factor = 2%), T(RPE)/T(Ch) = 3.2. With more numerous, lower power micropulses, T(RPE)/T(Ch) decreases monotonically to 1.39 as the duty factor is increased to 100%. These modelling studies provide the first quantitative predictions of thermal localization achieved with diode laser micropulsing and demonstrate that short pulse lengths and low duty factors allow for maximum thermal localization. These studies will potentiate pulse-shape optimization strategies for diode laser retinal photocoagulation applications.