PURPOSE. To assess the impact of diabetic retinopathy (DR) and diabetic macular edema (DME) on health-related quality of life (HRQoL) in type 1 and type 2 diabetes using the EuroQoL EQ-5D generic multi-attribute utility instrument (MAUI). METHODS. In this cross-sectional study, 577 patients with diabetes were recruited from specialized eye clinics in Melbourne, Australia. Each patient underwent clinical, biochemical, and anthropometric assessments. The severity of combined DR and DME (no DR/DME; mild NPDR [nonproliferative DR (NPDR)] and/or mild DME; moderate NPDR and/or moderate DME; and vision-threatening DR (VTDR) (severe NPDR or PDR and/or severe DME) in the worse eye was calculated. EQ-5D utility measures were the main outcome. Because the distribution of the utility measures was skewed, independent associations were explored using multivariate quantile regression models (five quintiles, namely 15th, 30th, 45th, 60th, 75th) ranging from poorest to highest HRQoL. RESULTS. Median age of the participants was 66 years (range, 26-90 years). Of the 577 participants, 223 (38.7%) had no DR/DME, 35 (6.1%) had mild NPDR/DME, 127 (22.0%) had moderate NPDR/DME, and 192 (33.3%) had VTDR. In adjusted models, neither presence nor severity of DR/DME was significantly associated with any quantile of the EQ-5D. In contrast, the presence of diabetic complications (other than DR) (β = -0.153; SE = 0.052; P < 0.001), other nonocular comorbidities (β = -0.115; SE = 0.038; P < 0.01), and higher body mass index (β = -0.007; SE = 0.002; P < 0.001) were all associated with worse HRQoL. CONCLUSIONS. Using a generic MAUI, the EQ-5D, the authors found that the presence or severity of DR/DME and concomitant vision loss were not associated with any quantile of HRQoL. These findings suggest that the EQ-5D lacks sensitivity in assessing the impact of the severity of DR/DME on HRQoL parameters and that condition-specific instruments may better capture the full impact of the association.