Wadjet was one of the earliest of Egyptian deities who later became associated with other goddesses such as Bast, Mut, and Hathor, who is also depicted with this eye. Burial amulets were often made in the shape of the Eye of Horus, to protect the owner in the afterlife and to ward off evil. Ancient Egyptian and Near Eastern sailors would frequently paint the symbol on the bow of their vessel to ensure safe sea travel (Charles Freeman, The Legacy of Ancient Egypt, Facts on File, Inc. 1997. p.91).
"Horus was the ancient Egyptian sky god who was usually depicted as a falcon. His right eye was associated with the sun Ra. The eye symbol represents the marking around a Peregrine Falcon's eye that includes the "teardrop" marking sometimes found below the eye."
It is interesting to note that, in the ancient egyptian calculus, the Eye Of Horus defined number one (1) = 1/2 + 1/4 + 1/8 + 1/16 + 1/32 + 1/64, by throwing away 1/64. The parts of the Eye were used to represent fractions.
Amulets on display at the Egyptian Museum, Torino