Background:In Nigeria, with a rising incidence of diabetes mellitus (DM), there are no controlled studies of specific psychiatric morbidity among sufferers. Objective: To assess the prevalence of specific psychiatric disorders and general cognitive impairment in patients with diabetes mellitus. Method: Using Wing's Present State Examination and the Mini-Mental State Examination, we assessed the prevalence of specific psychiatric disorders and cognitive impairment among 100DM patients attending an out-patient clinic, in comparison with a matched non-clinic sample; and examined the relationship between psychiatric morbidity and clinical variables. Results: They were predominantly males (66%), mean age 43.0 years, mean duration of illness, 7.7 years and in low level occupations. Only 11 of the patients had sexual dysfunction (11%) and psychiatric symptoms (31%). Psychiatric diagnosis (ICD-10) were, generalised anxiety (6%) and mild depressive disorder (4%). Two had subjective memory disturbance. Insulin-dependent patients had significantly more widespread psychiatric symptoms than the non-insulin dependent. Psychiatric symptomatology was significantly associated with low occupational status, duration of illness and sexual dysfunction. Conclusion: Health education, subsidising the cost of treatment, and physicians' sensitivity to the emotional condition of patients, will help to relieve psychic distress and make for more adequate management.