BACKGROUND: Inflammation has been proposed to be important in the pathogenesis of diabetic retinopathy. An early feature of inflammation is the release of cytokines leading to increased expression of endothelial activation markers such as vascular cellular adhesion molecule-1 (VCAM-1). Here we investigated the impact of diabetes and dyslipidemia on VCAM-1 expression in mouse retinal vessels, as well as the potential role of tumor necrosis factor-α (TNFα). METHODOLOGY/PRINCIPAL FINDINGS: Expression of VCAM-1 was examined by confocal immunofluorescence microscopy in vessels of wild type (wt), hyperlipidemic (ApoE(-/-)) and TNFα deficient (TNFα(-/-), ApoE(-/-)/TNFα(-/-)) mice. Eight weeks of streptozotocin-induced diabetes resulted in increased VCAM-1 in wt mice, predominantly in small vessels (<10 µm). Diabetic wt mice had higher total retinal TNFα, IL-6 and IL-1β mRNA than controls; as well as higher soluble VCAM-1 (sVCAM-1) in plasma. Lack of TNFα increased higher basal VCAM-1 protein and sVCAM-1, but failed to up-regulate IL-6 and IL-1β mRNA and VCAM-1 protein in response to diabetes. Basal VCAM-1 expression was higher in ApoE(-/-) than in wt mice and both VCAM-1 mRNA and protein levels were further increased by high fat diet. These changes correlated to plasma cholesterol, LDL- and HDL-cholesterol, but not to triglycerides levels. Diabetes, despite further increasing plasma cholesterol in ApoE(-/-) mice, had no effects on VCAM-1 protein expression or on sVCAM-1. However, it increased ICAM-1 mRNA expression in retinal vessels, which correlated to plasma triglycerides. CONCLUSIONS/SIGNIFICANCE: Hyperglycemia triggers an inflammatory response in the retina of normolipidemic mice and up-regulation of VCAM-1 in retinal vessels. Hypercholesterolemia effectively promotes VCAM-1 expression without evident stimulation of inflammation. Diabetes-induced endothelial activation in ApoE(-/-) mice seems driven by elevated plasma triglycerides but not by cholesterol. Results also suggest a complex role for TNFα in the regulation of VCAM-1 expression, being protective under basal conditions but pro-inflammatory in response to diabetes.