Managing diabetes requires dealing with diet, medications, and self-monitoring, besides other pressures of daily living. It, therefore, requires collaboration among individuals with diabetes, their families, and significant others including the social milieu in which they reside. Psychological stress plays critical role in the cause and course of diabetes, particularly in mastering various self-management skills, which are essential for adequate management of diabetes. It is possible to measure and to resolve such stressors. Besides the patient and the family, the built environment which the person occupies must be conducive for healthy living. This is a key component in providing an appropriate physical and psychosocial environment. Lacunae in any of the built environmental parameters compromise social and psychological well-being. Psychiatric conditions are also common in diabetes. Both depression and distress are bi-directionally associated with diabetes. The presence of one condition increases the risk of developing the other. In addition, medications used for the treatment of psychiatric conditions have adverse effects on body weight and insulin sensitivity. One must carefully weigh the risk and benefit of the drug class with potential adverse effects. Therefore, identification and management of psychological and psyciatric aspects in subjects with diabetes is an integral and critical component in treating subjects with diabetes.