Diabetic retinal microangiopathy is characterized by increased permeability, leukostasis, microthrombosis, and apoptosis of capillary cells, all of which could be caused or compounded by activation of complement. In this study, we observed deposition of C5b-9, the terminal product of complement activation, in the wall of retinal vessels of human eye donors with 9 +/- 3 years of type 2 diabetes, but not in the vessels of age-matched nondiabetic donors. C5b-9 often colocalized with von Willebrand factor in luminal endothelium. C1q and C4, the complement components unique to the classical pathway, were not detected in the diabetic retinas, suggesting that C5b-9 was generated via the alternative pathway, the spontaneous activation of which is regulated by complement inhibitors. The diabetic donors showed a prominent reduction in the retinal levels of CD55 and CD59, the two complement inhibitors linked to the plasma membrane by glycosylphosphatidylinositol anchors, but not in the levels of transmembrane CD46. Similar complement activation in retinal vessels and selective reduction in the levels of retinal CD55 and CD59 were observed in rats with a 10-week duration of streptozotocin-induced diabetes. Thus, diabetes causes defective regulation of complement inhibitors and complement activation that precede most other manifestations of diabetic retinal microangiopathy. These are novel clues for probing how diabetes affects and damages vascular cells.