(1) Background: Chronic obstructive pulmonary disease (COPD) is the leading cause of morbidity and mortality worldwide. Diabetes mellitus (DM) has been shown to have adverse inflammatory effects on lung anatomy and physiology. We investigated the impact of DM on COPD patient outcomes during inpatient hospitalization. (2) Methods: We conducted a retrospective analysis using the Nationwide Inpatient Sample (NIS) over the years 2002–2014. Three groups, COPD without diabetes, COPD with diabetes but no complication, and COPD with DM and complication, were analyzed. (3) Results: A total of 7,498,577 were COPD hospitalization; of those, 1,799,637 had DM without complications, and 483,467 had DM with complications. After adjusting for clinical, demographic, and comorbidities, the odds of increased LOS in the COPD/DM with complication were 1.37 (confidence interval (CI): 1.326–1.368), and those of DM without complication were 1.061 (1.052–1.070) when compared with COPD alone. The odds of pneumonia, respiratory failure, stroke, and acute kidney injury were also higher in COPD hospitalizations with DM. Both DM with complication (odds ratio (OR): 0.751 (CI 0.727–0.777)) and DM without complication (OR: 0.635 (CI: 0.596–0.675)) have lesser odds of mortality during hospitalization than with COPD alone. (4) Conclusions: There is a considerable inpatient burden among COPD patients with DM in the United States.