Aims: The LENS trial demonstrated that fenofibrate slowed the progression of diabetic retinopathy compared to placebo in participants with early diabetic eye disease. We assessed its cost-effectiveness for reducing the progression of diabetic retinopathy versus standard care from a UK National Health Service perspective. Methods: Resource use and outcome data were collected over follow-up for participants enrolled in LENS. Mean costs were compared at 2 years and per 6-month follow-up (median 4.0 years). Within the trial, cost-effectiveness was assessed in terms of the incremental cost per case of referable disease averted. A microsimulation model, with inputs derived primarily from LENS trial data, was used to assess the incremental cost per quality-adjusted life year (QALY). Results: Fenofibrate resulted in a mean (95% confidence interval) reduction in health service costs of -£254 (−1062 to 624) at 2 years and -£101 (−243 to 42) per 6-month follow-up. This was accompanied by a 4.4% (1.3% to 8.0%) absolute reduction in any referable diabetic retinopathy or treatment thereof at 2 years, and a 27% (9%–42%) relative reduction over follow-up. Modelled over 10 years, fenofibrate use cost an additional £6 per patient for an expected QALY gain of 0.02, costing £406 per QALY versus standard care under base case assumptions. The probability of cost-effectiveness varied from 70% to 79% at a threshold of £20,000 per QALY, depending on the price discount applied to anti-VEGF drugs. Conclusions: Fenofibrate is likely to offer a cost-effective treatment for slowing the progression of diabetic retinopathy in people with early to moderate diabetic retinopathy or maculopathy.