Retinopathy, a common cause of blindness, is a hallmark of diabetes and depends on two pathological mechanisms: vasculopathy and neuropathy. Whereas vasculopathy is well understood and has been associated with changes in gelatinase B/matrix metalloproteinase-9 (MMP-9) and other vasculotropic factors, specific markers for diabetes-induced retinal neuropathy are not yet described. Neuropathy may result from damages to the blood-retinal barrier (BRB) and from loss of neuroprotective factors. We studied diabetes-induced changes in vascular, inflammatory and regenerative markers and demonstrated that MMP-9 was increased, whereas prominin-1/CD133 was decreased in retinal extracts. In vitro, MMP-9 specifically destroyed prominin-1/CD133. Streptozotocin-induced diabetes resulted in BRB breakdown as a sign of vasculopathy and in prominin-1/CD133 destruction in photoreceptors as an in situ parameter of diabetic neuropathy. Both in vivo phenotypes were completely reversed in single MMP-9 gene knockout mice, demonstrating that MMP-9 mediates both diabetes-induced retinal vasculopathy and neuropathy, with prominin-1/CD133 being a critical and specific substrate of MMP-9. This functional link between gelatinase B/MMP-9 and prominin-1/CD133 explains mechanistically both the vasculopathy and neuropathy of diabetic retinopathy and suggests that specific MMP-9 inhibition is an interesting therapeutic avenue to investigate.