We investigated the retinal findngs in eleven patients with diabetes mellitus during interferon (IFN) therapy for chronic type C hepatitis. Fundic examinations were performed periodically before and at 1 week, 2 weeks and 4 weeks and every month after IFN therapy. In eight of nine patients (88.9%) free of diabetic retinopathy before IFN therapy, retinal abnormalities, dot or patchy hemorrhage and cotton-wool spots, developed during IFN therapy. In another two patients with diabetic retinopathy before IFN therapy, retinal hemorrhage worsened. Therefore, we considered that diabees mellitus was a risk factor for retinal abnormality during IFN therapy. Fortunately, these abnormalities were not severe and did not exacerbate during IFN treatment except for one patient with diabetic retinopathy before IFN therapy, whose visual acuity was impaired. Thus we should use IFN carefully for diabetic patients.