Drosophila melanogaster Crumbs (Crb) and its mammalian orthologues (CRB1-3) share evolutionarily conserved but poorly defined roles in regulating epithelial polarity and, in photoreceptor cells, morphogenesis and stability. Elucidating the molecular mechanisms of Crb function is vital, as mutations in the human CRB1 gene cause retinal dystrophies. Here, we report that Crb restricts Rac1-NADPH oxidase-dependent superoxide production in epithelia and photoreceptor cells. Reduction of superoxide levels rescued epithelial defects in crb mutant embryos, demonstrating that limitation of superoxide production is a crucial function of Crb and that NADPH oxidase and superoxide contribute to the molecular network regulating epithelial tissue organization. We further show that reduction of Rac1 or NADPH oxidase activity or quenching of reactive oxygen species prevented degeneration of Crb-deficient retinas. Thus, Crb fulfills a protective role during light exposure by limiting oxidative damage resulting from Rac1-NADPH oxidase complex activity. Collectively, our results elucidate an important mechanism by which Crb functions in epithelial organization and the prevention of retinal degeneration.