Diabetic retinopathy (DR) is a disease that can cause blindness. Bone morphogenetic protein-4 (BMP4) was reported be overexpressed in DR model. However, the specific mechanism of BMP4 in DR development has not been explored. MiR-340-5p and BMP4 levels were detected by RT-qPCR in MIO-M1 cells and retinas of mice. Western blot analysis was used to examine GFAP, BMP4 and BRB junction protein levels. Inflammatory cytokine secretion and the retina structure were examined by ELISA and H&E staining, respectively. The interaction between miR-340-5p and BMP4 was identified by luciferase reporter assay. In HG-stimulated MIO-M1 cells, BMP4 was upregulated. Mechanically, BMP4 was targeted by miR-340-5p and negatively regulated by miR-340-5p. In rescue assays, BMP4 countervailed the suppressive effects of miR-340-5p on activation of Müller cells and release of inflammatory cytokines. Additionally, miR-18a-3p overexpression alleviated BRB injury to inhibit DR progression in vivo. In conclusion, miR-340-5p inhibits DR progression by targeting BMP4, which may offer a new pathway for treatment of DR.