Pathological neovascularization (NV) can cause visual impairment in retinopathy of prematurity (ROP). Current treatments addressing vasoproliferative (Phase II) ROP are costly and can lead to severe complications. We show that well-timed topical 0.1% dexamethasone eye drops during early retinal neovascular formation prevents NV in five extremely preterm infants at high risk for ROP and in mouse oxygen-induced retinopathy (OIR) modeling ROP. In OIR mice, daily treatment before any NV has limited efficacy in mitigating NV, while treatment after peak NV exhibits no statistically significant effect but with a trend to exacerbating NV. Optimally timed topical dexamethasone suppression of NV in OIR is associated with increased retinal mitochondrial gene expression and a decrease in inflammatory markers predominantly expressed in immune cells. This study provides new insights into topical steroid effects in retinal NV and into mitochondrial function in phase II ROP, and suggests a simple approach to preventing severe ROP.