Diabetic macular edema (DME), a severe complication of diabetic retinopathy, exhibits an increasing occurrence rate in parallel with the rising prevalence of diabetes mellitus. It has emerged as a leading cause of vision loss, imposing substantial economic burdens on society and families. It has demonstrated that the conventional treatments, such as intravitreal anti-vascular endothelial growth factor (VEGF) injections and laser photocoagulation, had limited efficacy in certain refractory patient populations. In recent years, significant advancements have been achieved in both mechanistic studies and clinical management of DME: novel anti-VEGF agents featuring dual-target inhibition exhibit superior efficacy in improving retinal morphology with longer intervals of injection and lower complications. Corticosteroid therapy offers a viable alternative for refractory cases, though clinicians must remain vigilant against complications such as elevated intraocular pressure and cataract formation. Combination therapies, integrating anti-VEGF agents with dexamethasone, laser photocoagulation, or adjunctive medications, reduce injection frequency and exert synergistic therapeutic effects. Vitrectomy with internal limiting membrane peeling remains controversial regarding anatomical improvement in refractory DME; however, it holds potential in alleviating mechanical traction and clearing inflammatory mediators. Further refinement via subretinal injection techniques may enhance the clearance of hard exudates. Emerging technologies, including artificial intelligence assisted prediction of anti-VEGF response and gene therapy, present promising avenues for personalized treatment and sustained intervention. Despite these advances, the pathophysiology of DME remains incompletely elucidated. Future research should prioritize the development of long-acting therapeutics, precision medicine strategies, and multicenter clinical validation to optimize visual outcomes for patients.