As in Oedipus Rex, physical blindness, in this case the cruel blinding of Gloucester, leads to insight. As with Oedipus, blindness humbles Gloucester and allows him to see reality more clearly.
Otherwise, blindness in King Lear is metaphoric. Powerful characters in the play, most notably Lear himself and Gloucester, are blind to the evil machinations of their children. Both men are so used to being catered to and flattered that they have lost sight of the fact that people behave to them with kindness and deference not because they are inherently lovable, but because they are powerful. They have grown blind to the fact that the flattering words they hear might not reflect reality.
It is not until he is cast out into the storm that the elderly Lear realizes he is, after all, just another human being like anyone else. Power is a form of blindness, Shakespeare argues in this play.