Seismic diffractions are some weak seismic events hidden within the more dominant reflection events in a seismic profile. Separating diffraction energy from the post-stack seismic profiles can help infer the subsurface discontinuities that generate the diffraction events. The separated seismic diffractions can be migrated with a traditional seismic imaging method or a specifically designed migration method to highlight the diffractors, i.e., the diffraction image. Traditional diffraction separation methods based on the the underlying plane-wave assumption are limited by either the inaccurate slope estimation or the plane-wave assumption of the PWD filter, and thus will cause reflection leakage into the separated diffraction profile. The leaked reflection energy will deteriorate the resolution of the subsequent diffraction imaging result. Here, we propose a new diffraction separation method based on a localized rank-reduction method. The localized rank-reduction method assumes the reflection events to be locally low-rank and the diffraction energy can be separated by a rank-reduction operation. Compared with the global rank-reduction method, the localized rank-reduction method is more constrained in selecting the rank and is free of separation artifacts. We use a carefully designed synthetic example to demonstrate that the localized rank-reduction method can help separate the diffraction energy from a post-stack seismic profile with both kinematically and dynamically accurate performance.