Disruption of the quiescent state of blood vessels in the retina leads to aberrant vasopermeability and angiogenesis, the major causes of vision loss in diabetic retinopathy. Prolactin is expressed throughout the retina, where it is proteolytically cleaved to vasoinhibins, a family of peptides (including the 16-kDa fragment of prolactin) with potent antiangiogenic, vasoconstrictive, and antivasopermeability actions. Ocular vasoinhibins act directly on endothelial cells to block blood vessel growth and dilation and to promote apoptosis-mediated vascular regression. Also, vasoinhibins prevent retinal angiogenesis and vasopermeability associated with diabetic retinopathy, and inactivation of endothelial nitric oxide synthase via protein phosphatase 2A is among the various mechanisms mediating their actions. Here, we discuss the potential role of vasoinhibins both in the maintenance of normal retinal vasculature and in the cause and prevention of diabetic retinopathy and other vasoproliferative retinopathies.