To investigate the protective effect of acetagastrodin on visual electrophysiology in patients with early-stage diabetes. A prospective, randomized, controlled, double-blind trial was conducted. Subjects who were randomly assigned to either the treatment group or the control group were orally administered acetagastrodin or placebo, respectively, for 6 months. The quantity, mean amplitude and mean latency of oscillatory potentials (OPs) wavelets at baseline and 6 months were measured on electroretinogram (ERG), in all subjects. A total of 92 right eyes in 92 patients with type 2 diabetes, who were diagnosed for the first time, were enrolled. Each group consisted of 46 cases (46 eyes). There was no significant difference in baseline characteristic between treatment and control groups at baseline, but quantity in treatment group was more than that in control group at 6 months (P = 0.001). The mean amplitude of OPs was reduced in the control group 6 months later compared with treatment group (P = 0.001). As to mean latency of OPs, statistical difference was also detectable between the treatment group and control group 6 months later (P < 0.001). No statistical differences were found in hemoglobin between both groups at 6 months (P > 0.05). Electrophysiological changes would go on worsening even hemoglobin was under control during the initial stage of diabetes. Acetagastrodin treatment may be an effective treatment to protect retinal neurons against such functional impairment during the early stages of diabetes.