Evidence is mounting that proinflammatory and proapoptotic thioredoxin-interacting protein (TXNIP) has a causative role in the development of diabetes. However, there are no studies investigating the role of TXNIP in diabetic retinopathy (DR). Here, we show that, in diabetic rats, TXNIP expression and hexosamine biosynthesis pathway (HBP) flux, which regulates TXNIP, are elevated in the retina and correlates well with the induction of inflammatory cyclooxygenase 2 (Cox-2) and sclerotic fibronectin (FN). We blocked the expression of TXNIP in diabetic rat retinas by: (i) inhibiting HBP flux; (ii) inducing post-transcriptional gene silencing (PTGS) for TXNIP mRNA; and (iii) performing an in vivo transcriptional gene silencing (TGS) approach for TXNIP knockdown by promoter-targeted small interfering RNAs and cell-penetrating peptides as RNA interference (RNAi) transducers. Each of these methods is efficient in downregulating TXNIP expression, resulting in blockade of its target genes, Cox-2 and FN, demonstrating that TXNIP has a causative role in aberrant gene induction in early DR. RNAi TGS of TXNIP abolishes diabetes-induced retinal gliosis and ganglion injury. Thus, TXNIP has a critical role in inflammation and retinal injury in early stages of DR. The successful employment of TXNIP TGS and amelioration of its pathological effects open the way for novel therapeutic strategies aimed to block disease onset and progression of DR.