Background This study aimed to evaluate the effects of coconut water on the general condition (fasting blood sugar and body weight) and retina of diabetic rats. Methods Forty-eight Sprague–Dawley male rats were divided into normal controls (NC), diabetes mellitus (DM), diabetes+coconut water (DM+CW), and diabetes+glibenclamide (DM+Gli) groups. After 4 weeks of normal feeding, coconut water was given to group III-DM+CW and 0.6 mg/kg glibenclamide to group IV–DM+Gli. The blood sugar, body weight, total retinal thickness, pathological changes, and VEGF expression in the retina were analyzed at different time points. Results The fasting blood sugar was 4–6 mmol/L in group I-NC and continuously increased in group II-DM, whereas gradually decreased after the 4th experiment week in the remaining two groups. The rats, except in group I-NC, have lost weight. In group II-DM, the total retinal thickness was significantly increased after the 8th and 12th experiment week, and the pathological changes in retina were observed. VEGF was almost fully expressed in the ganglion cell layer and inner granular layer and partially expressed in the outer granular layer in group II-DM, and mainly expressed in the ganglion cell layer and inner layer in group I-NC, with a lighter color. Group III-DM + CW and group IV-DM + Gli demonstrated similar VEGF expression as in group I-NC. Conclusions Coconut water has the potential to reduce blood sugar and diabetic retinal damage, serving as a candidate drug or nutrient for treating diabetes and its complications.