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Diabetic retinopathy (DR) is the most frequent microvascular complication of long-term diabetes and the most common cause of blindness, increasing morbidity in the working-age population. The most effective therapies for these complications include laser photocoagulation and anti-vascular endothelial growth factor (VEGF) intravitreal injections. However, laser and anti-VEGF drugs are untenable as a final solution as they fail to address the underlying neurovascular degeneration and ischemia. Regenerative medicine may be a more promising approach, aimed at the repair of blood vessels and reversal of retinal ischemia. Stem cell therapy has introduced a novel way to reverse the underlying ischemia present in microvascular complications in diseases such as diabetes. The present review discusses current treatments, their side effects, and novel cell-based and tissue engineering approaches as a potential alternative therapeutic approach.