Background: Diabetes is one of the most common chronic diseases and affects virtually every organ of the human system. Depression and anxiety is common among patients with diabetes and associated with worse diabetes outcomes. Aims and Objective: To study the prevalence and predictors of depression and anxiety in patients of Type 2 diabetes mellitus (T2DM) in Pt. B.D. Sharma, PGIMS, Rohtak, Haryana, India, a tertiary care center in Northern India. Materials and Methods: Four hundred ten consecutive patients having T2DM and 410 healthy controls matched for age and sex attending the endocrine out-patient department of a tertiary care center of Northern India were included in the study. Sociodemographic and relevant clinical variables were collected. They were evaluated for depression and anxiety using Hamilton Depression Rating Scale and Hamilton Anxiety Rating Scale respectively. Results: It was found that a significantly larger proportion of diabetic patients had depression (26.3% vs. 11.2%, P = 0.001), anxiety (27.6% vs. 12.7%, P = 0.001) and comorbid depression and anxiety (21.0% vs. 7.3%, P = 0.001) as compared to healthy controls. Diabetic women had higher depression (17.1% vs. 9.3%) and anxiety (17.6% vs. 10.0%) than men. The major predictors for a severe form of depression and anxiety among T2DM cases were age, female sex, insulin therapy, retinopathy, nephropathy, and ischemic heart disease. Conclusion: The present findings reveal that diabetic cases had significantly higher depression and anxiety as compared to healthy controls. The risk factors for depression and anxiety were age, female sex, insulin therapy, and diabetic complications.