Introduction: we investigated the association between OSA and vision-threatening diabetic retinopathy (VTDR). Methods: we used three nationwide registers to identify subjects with and without OSA and patients with type 1 (T1DM) or type 2 diabetes mellitus (T2DM). The Danish Civil Registration System was used to link OSA with diabetes diagnosis. The primary outcome was the occurrence of VTDR in diabetic patients with and without OSA. The secondary outcome was the prevalence of diabetes mellitus in patients with and without OSA. Results: we included 532,828 diabetic subjects comprising 13,279 patients with OSA (2.5%) and 519,549 without OSA (97.5%). Diabetic patients with OSA had a 57% lower risk of VTDR compared to diabetic patients without OSA (OR 0.43, 95% CI 0.38–0.50, p < 0.0001). Conclusions: our findings indicate that OSA is associated with a lower risk of VTDR. Since we did not adjust our outcomes for diabetes duration, hypertension control and hemoglobin A1c, future studies are needed to confirm our findings.