Diabetic retinopathy is a leading cause of blindness worldwide. Despite laser and surgical treatments, antiangiogenic and other therapies, and strict metabolic control, many patients progress to visual impairment and blindness. New insights are needed into the pathophysiology of diabetic retinopathy in order to develop new methods to improve the detection and treatment of disease and the prevention of blindness. Hyperglycemia and diabetes result in increased flux through the hexosamine biosynthetic pathway, which, in turn, results in increased PTM of Ser/Thr residues of proteins by O-linked β-N-acetylglucosamine (O-GlcNAc). O-GlcNAcylation is involved in regulation of many nuclear and cytoplasmic proteins in a manner similar to protein phosphorylation. Altered O-GlcNAc signaling has been implicated in the pathogenesis of diabetes and may play an important role in the pathogenesis of diabetic retinopathy. The goal of this review is to summarize the biology of the hexosamine biosynthesis pathway and O-GlcNAc signaling, to present the current evidence for the role of O-GlcNAc signaling in diabetes and diabetic retinopathy, and to discuss future directions for research on O-GlcNAc in the pathogenesis of diabetic retinopathy.