Diabetic retinopathy (DR) is a serious complication of diabetes that can lead to blindness if not detected early. This research presents a novel method for the identification of DR using fundus images, employing the Watershed Algorithm for accurate image segmentation and the gray level co-occurrence matrix (GLCM) for texture feature extraction. The image processing pipeline involves several stages, including grayscale conversion, noise reduction through Gaussian and median filters, and Otsu's thresholding to isolate key features such as retinal lesions. The watershed algorithm is applied to delineate the boundaries of abnormal regions, while the GLCM method extracts texture features like contrast, correlation, energy, and homogeneity, which are essential for diagnosing retinal abnormalities. The proposed approach demonstrates a high accuracy rate of 92%, successfully identifying abnormalities in 46 out of 50 fundus images. The method shows significant potential for enhancing early detection of DR, providing accurate segmentation and texture analysis, making it a valuable tool for medical professionals in diagnosing retinal diseases.