Background and aims: Diabetes mellitus is associated with poor prognosis in patients with COVID-19. On the other hand, COVID-19 contributes to worsening of dysglycemia in people with diabetes mellitus over and above that contributed by stress hyperglycemia. Herein, we have reviewed the two-way interactions between COVID-19 and diabetes mellitus. Methods: We have performed an extensive literature search for articles in PubMed, EMBASE and Google Scholar databases till April 25, 2020, with the following keywords: "COVID-19", "SARS-CoV-2", "diabetes", "diabetes mellitus", "SARS", "infection" and "management of diabetes mellitus" with interposition of the Boolean operator "AND". Results: Compromised innate immunity, pro-inflammatory cytokine milieu, reduced expression of ACE2 and use of renin-angiotensin-aldosterone system antagonists in people with diabetes mellitus contribute to poor prognosis in COVID-19. On the contrary, direct b-cell damage, cytokine-induced insulin resistance, hypokalemia and drugs used in the treatment of COVID-19 (like corticosteroids, lopinavir/ritonavir) can contribute to worsening of glucose control in people with diabetes mellitus. Conclusions: The two-way interaction between COVID-19 and diabetes mellitus sets up a vicious cycle wherein COVID-19 leads to worsening of dysglycemia and diabetes mellitus, in turn, exacerbates the severity of COVID-19. Thus, it is imperative that people with diabetes mellitus take all necessary precautions and ensure good glycemic control amid the ongoing pandemic.