We studied whether nonmydriatic digital retinal imaging with remote interpretation (teleretinal imaging) in the ambulatory care setting affected adherence to annual dilated eye examinations among patients with diabetes. We randomly assigned 448 patients to a teleretinal imaging group or a control group. We measured the number of patients who had dilated eye examinations within 12 months of group assignment and the agreement for level of diabetic retinopathy between teleretinal imaging and the eye examinations. The teleretinal imaging group (n = 223) had significantly more dilated eye examinations than the control group (n = 225). Teleretinal imaging and eye examination results showed significant correlation and moderate agreement. Cataract and smaller pupil size were significantly associated with ungradable retinal images. Two-thirds of patients with ungradable images had other ocular findings. Patients reported high satisfaction with nonmydriatic teleretinal imaging. Nonmydriatic teleretinal imaging improves diabetic retinopathy assessment rates.