We examined the pathogenesis of reduced amplitude in electroretinogram (ERG) oscillatory potentials (OPs) in diabetes, in relation to possible changes in the metabolisms involving retinal amino acid neurotransmitters. With use of streptozotocin diabetic rats, flash ERGs were recorded and quantitative analyses of retinal free amino acids were performed. Immunocytochemical localizations of retinal glycine and GABA were examined. In addition, activities of glutamic acid decarboxylase (GAD) and GABA transaminase (GABA-T) were measured. Our results revealed that the amplitudes of OP 1 and OP 2 decreased, and retinal glycine and GABA content significantly increased in the diabetic rats. An increased immunoreactivity of GABA was observed in Muller cells in the diabetic rat retinas, while no apparent changes were found in glycine immunoreactivity. Finally, increased activations of GAD with reduced activities of GABA-T were observed in the diabetic rat retinas. Thus, reduced amplitudes of OPs were associated with changes in content, localization, and enzyme activities related to GABA in the retinas, implying that changes in GABA metabolism can be a candidate for the pathogenesis of the abnormal OPs in diabetes.