The evil eye is a definite issue to deal with in Judaism. Looking upon another person in a bad light or not giving the benefit of the doubt is one thing, and we are taught that we must we must not judge unless we first stand in the other persons shoes.
The Evil Eye (Ayin Ha Ra in Hebrew) is a much more serious issue. It stems from simple jealousy and envy, i.e. the fact that someone has something that you don't have, and you want it. As a result, you start to broadcast bad "vibes" towards the other person. It is believed that those bad "vibes" flow into the spiritual world and are received by Gods' "prosecutors". Since everything that happens to a person happens for a reason, the prosecutors must determine if the receiver of the Evil Eye really deserves it for some reason. They open his "file" and examine his deeds, and if there is some past deed in his file that appears to deserve punishment, the prosecutors will refer the case up to God who will examine the evidence and then pass judgement. If God feels that the prosecution has merit, then he will execute some form of punishment, either by himself or through one of his agents.
So, when someone gives an Evil Eye to someone else, it can potentially have some bad consequences for the receiver.
On the other hand, if the prosecutor examines the case and finds no fault in the receiver of the Evil Eye, they open a case against the Giver, using a similar process. This brings to mind the old saying that "People who live in glass houses shouldn't throw stones".
God created us and gave us free will. It is his hope that everyone will excercise the gift of free will to do only positive things and not negative ones. God willing, if we all work on ourselves, eliminate our hatreds and jealousies, we will come to only love others and thus create "Heaven on Earth".