OBJECTIVE To investigate the physiological function in the posterior pole of the retina in eyes with preproliferative diabetic retinopathy using the oscillatory potentials (OPs) of the multifocal electroretinogram (mfERG). METHODS Multifocal ERGs were recorded from 61 eyes of 61 patients with preproliferative diabetic retinopathy (pre-PDR) and 16 eyes of 16 age-similar normal control subjects. The amplitudes and implicit times of the first positive component, P1, and the OPs of the mfERGs, recorded with a slow m-sequence, from diabetics were compared with those in normal control subjects. Among the 61 eyes, the mfERGs were recorded before and after panretinal photocoagulation (PRP) in 19 eyes of 19 patients. RESULTS The amplitudes of P1 and OPs were significantly smaller in all tested areas in the diabetics as compared with those in the normal subjects, and the degree of reduction was greater for the OPs than P1. The implicit times of P1 and OPs were significantly delayed in the diabetics in the peripheral tested regions (20-40 degrees) but not in the central area After PRP, the amplitudes of P1 were markedly reduced in all areas tested; however, the changes of the P1 implicit time were not significant. The amplitudes of the OPs were significantly reduced in the peripheral regions after PRP; however, the changes in the implicit times were not significant. CONCLUSIONS These results indicate that retinal function in the posterior pole is markedly impaired in eyes with pre-PDR. PRP altered the mfERGs significantly, however, the reductions were limited to the amplitude.