OBJECTIVES: New technologies in screening and treatment of diabetic retinopathy (DR) and diabetic macular edema (DME) have emerged recently. The goal of this systemic literature review is to identify and compare critical gaps in the published economic evaluation literatures for screenings and treatments strategies of DR/DME.  METHODS: A systematic literature search was conducted to identify literature in English from 1980-2010, using PubMed, Embase, NHS NICE EED, and Tuft CEA Registry. Key terms included “diabetic retinopathy”, “diabetic macular edema”, and relevant terms for economic evaluations. All studies related to economic analysis and decision modeling were included. Studies that focused only on cost or utility were excluded.  RESULTS: 52 articles were identified and 33 were excluded based on the pre-specified exclusion criteria.  Of the remaining 19 studies, nine (47%) focused on screening methods, six (32%)on diabetic care, and four (21%) on DR/DME treatment. Among the included studies, 12 studies (63%) were cost-effective analyses, and sight-years saved was the most frequently used endpoint. Seven studies (37%) were cost-utility analyses. A broad range of decision-analytic frameworks and health state descriptions were observed. Some only assigned utility to blindness, not to diabetic patients who may have impaired quality of life due to vision loss. In addition, although DR/DME is a bilateral condition, most studies did not clearly explain how cost, utility, and disease progression were modeled for the second eye.  CONCLUSIONS: This literature review identified a range of decision analytic frameworks, health states definitions, and utility sources employed in economic evaluations of screening and treatment of DR/DME. Future studies assessing cost-effectiveness of new technologies should transparently address these areas.