BACKGROUND Diabetes mellitus (DM) is a growing medical issue all over the world with Diabetic retinopathy (DR) being the leading cause of acquired yet potentially avoidable blindness. Anaemia can be an individual risk factor in the progression of cardiovascular disease and chronic renal disease along with DR. AIM The aim of our study is to prove that anaemia is a risk factor for DR in patients with type 2 diabetes. MATERIALS AND METHODS This Hospital based cohort study includes 240 patients of both the genders (130 males and 110 females) with type 2 DM having DR. Blood investigations including haemoglobin levels by colorimetric method, glycosylated haemoglobin (HbA1c) blood urea nitrogen, serum creatinine were also assessed. SPSS version17 was used for statistical analysis. RESULTS The mean age of enrolled patients was 56.68+10 years. Of the 240 patients that were included in the study, 92 (38.3%) had diabetes of <5 years, 124 (51.7%) had diabetes of 5-10 years and 24 (10%) had diabetes of >10 years. Of the 480 eyes of 240 patients, 188 (39.1%) had mild NPDR (Non Proliferative Diabetic Retinopathy), 140 (29.2%) moderate NPDR, 140 (29.2%) severe NPDR and 12 (2.5%) had PDR (Proliferative Diabetic Retinopathy). Out of 130males, 21 (16.2%) had haemoglobin level <13g/dl. Out of 110 females, 76 (69%) had haemoglobin level <12g/dl. CONCLUSION Frequent screening for DR in all type 2 DM patients is important if patients have longer duration of diabetes, high blood glucose levels, irregular glycaemic control, renal disorders or anaemia due to any cause