Subject Level Criteria Inclusion

To be eligible, the following inclusion criteria (1-4) must be met:

1. Age ≥18 years
2. Diagnosis of diabetes mellitus (type 1 or type 2)
3. At least one eye meets the study eye criteria

4. Able and willing to provide informed consent.

   Study Level Exclusion Criteria

   A patient is not eligible if any of the following exclusion criteria (5-13) are present:

5. History of chronic renal failure requiring dialysis or kidney transplant.
6. A condition that, in the opinion of the investigator, would preclude participation in the study (e.g., unstable medical status including blood pressure and glycemic control). Patients in poor glycemic control who, within the last 4 months, initiated intensive insulin treatment (a pump or multiple daily injections) or plan to do so in the next 4 months should not be enrolled.
7. Participation in an investigational trial within 30 days of study entry that involved treatment with any drug that has not received regulatory approval at the time of study entry.
8. Known allergy to any corticosteroid or any component of the delivery vehicle.
9. History of systemic (e.g., oral, IV, IM, epidural, bursal) corticosteroids within 4 months prior to randomization or topical, rectal, or inhaled corticosteroids in current use more than 2 times per week.
10. History of steroid-induced intraocular pressure elevation that required IOP-lowering treatment in either eye.
11. Warfarin (coumadin) currently being used.
12. Blood pressure > 180/110 (systolic above 180 OR diastolic above 110). If blood pressure is brought below 180/110 by anti-hypertensive treatment, patient can become eligible.

13. Patient is expecting to move out of the area of the clinical center to an area not covered by another clinical center during the next 8 months.

    The patient must have at least one eye meeting all of the inclusion criteria (a-e) and none of the exclusion criteria (f-t) listed below:

    Study Eye Inclusion Criteria

    1. Best corrected E-ETDRS visual acuity score of ≥69 letters (i.e., 20/40 or better).
    2. Definite retinal thickening due to diabetic macular edema based on clinical exam.
    3. Retinal thickness in the OCT central subfield measuring 250 microns or more.
    4. Maximal laser has not already been given and investigator believes that either peribulbar steroids or laser may benefit the eye (note: subjects may be enrolled without having received prior macular laser).

    5. Media clarity, pupillary dilation, and patient cooperation sufficient for adequate fundus photographs and OCT.

       Study Eye Exclusion Criteria

    6. Macular edema is considered to be due to a cause other than diabetic macular edema.
    7. An ocular condition is present such that, in the opinion of the investigator, visual acuity would not improve from resolution of macular edema (e.g., foveal atrophy, pigmentary changes, dense subfoveal hard exudates, nonretinal condition).
    8. An ocular condition is present (other than diabetes) that, in the opinion of the investigator, might affect macular edema or alter visual acuity during the course of the study (e.g., vein occlusion, uveitis or other ocular inflammatory disease, neovascular glaucoma, Irvine-Gass Syndrome, etc.).
    9. History of prior treatment with intravitreal, peribulbar, or retrobulbar corticosteroids for DME.
    10. History of focal/grid macular photocoagulation within 15 weeks (3.5 months) prior to randomization. Note: Patients are not required to have had prior macular photocoagulation to be enrolled.
    11. History of panretinal scatter photocoagulation (PRP) within 4 months prior to randomization or anticipated need for PRP in the 4 months following randomization.

    m. History of prior vitrectomy.

    n. History of major ocular surgery (including cataract extraction, scleral buckle, any intraocular surgery, etc.) within prior 6 months or anticipated within the next 6 months following randomization.

    o. History of YAG capsulotomy performed within 2 months prior to randomization.

    p. Intraocular pressure ≥25 mmHg.

    q. History of open-angle glaucoma (either primary open-angle glaucoma or other cause of open-angle glaucoma; note: angle-closure glaucoma is not an exclusion). A history of ocular hypertension is not an exclusion as long as (1) intraocular pressure is <25 mm Hg, (2) the patient is using no more than one topical glaucoma medication, (3) the most recent visual field, performed within the last 12 months, is normal (if abnormalities are present on the visual field they must be attributable to the patient's diabetic retinopathy), and (4) the optic disc does not appear glaucomatous. Note: if the intraocular pressure is 22 to <25 mm Hg, then the above criteria for ocular hypertension eligibility must be met.

    r. History of prior herpetic ocular infection.

    s. Exam evidence of ocular toxoplasmosis.

    t. Exam evidence of pseudoexfoliation.

    A patient may have two "study eyes" only if both are eligible at the time of randomization.