The association between the incidence of diabetic retinopathy and the development of diabetic nephropathy was studied in 110 Type I (insulin-dependent) diabetic patients during a period from 10 years before to 5 years after the onset of persistent proteinuria. This group of patients was compared with 110 diabetic patients, who were matched according to sex, age, and diabetes duration, but who were without proteinuria during the observation period. The cumulative incidence of proliferative retinopathy was 74% in patients with clinical nephropathy and 14% in patients free of proteinuria. The incidence of background retinopathy was 93% and 37%, respectively, and the incidence of retinopathy increased dramatically 5 years before the onset of proteinuria. Neither gender, age at onset of diabetes, nor blood pressure seemed to have much influence on the incidence of severe retinopathy. It is concluded that development of clinical diabetic nephropathy implies an extremely high risk of developing severe retinopathy. A common pathogenetic link may be suspected.