This study evaluated the association of mood disorders, suicidal ideation and the quality of life in patients with type 2 diabetes. We used a case-control study employing 996 patients suffering with type 2 diabetes (using insulin for over 1 year), and 2.145 individuals without diabetes. The groups were then used to evaluate the presence of different mood disorders and suicidal ideation, beyond quality of life. In addition to this, fasting glucose and glycosylated hemoglobin (Hb1C) were also evaluated. The data were analyzed using the Pearson chi-squared test, logistic regression, ANCOVA and Student's t-tests. We showed an association between type 2 diabetes and depressive episodes (adjusted OR = 1.8, CI 95 % 1.7-2.0, p < 0.001), recurrent depressive episodes (adjusted OR = 2.4, CI 95 % 2.2-2.6, p < 0.001), dysthymia (adjusted OR = 5.2, CI 95 % 4.9-5.5, p < 0.001), mood disorder with psychotic symptoms (adjusted OR = 2.5, CI 95 % 1.5-3.4, p < 0.001) and suicidal ideation (adjusted OR = 3.6, CI 95 % 2.5-4.8, p < 0.001, light; adjusted OR = 4.6, CI 95 % 1.5-7.7, p < 0.01, moderate and severe). The recurrent depression (OR = 1.3, CI 95 % 1.1-1.7, p < 0.05) and psychotic symptoms (OR = 4.1, CI 95 % 1.1-15.1, p < 0.05) were associated with higher levels of Hb1C. Dysthymia was associated with high blood glucose (OR = 1.6, CI 95 % 1.1-2.5, p < 0.05). Patients had lower mean scores in the following domains: physical [36.5 (13.6) × 56.0 (4.9), p < 0.001)], psychological [42.6 (8.6) × 47.9 (8.6), p < 0.001] and environmental [40.0 (8.6) × 49.3 (8.3), p < 0.001], but had higher scores in the area of social relations [50.2 (16.9) × 35.7 (27.9), p < 0.001]. The data demonstrated a worse quality of life, a high comorbidity of type 2 DM with depressive disorders and suicidal ideation. In addition, the poor control of DM is associated with the severity of mood disorders.