This study was conducted to find out the association of diabetes mellitus with cognitive functioning and depressive features. We included 50 diabetic and 30 control subjects who were screened on the basis of various inclusion and exclusion criteria. Then, a history of variables under study was taken and respective laboratory investigations were noted. First, the Becks Depression Inventory (BDI) was administrated to the patients. The cognitive function was then assessed using the digit span test, stroop Test, controlled oral word association test, visual target cancellation test, digit symbol substitution test, and visuospatial working memory matrix. The composite score on all tests was used to make cognitive index. The data was compiled and appropriate statistical methods were used. We found that 48% of elderly diabetic patients showed cognitive impairment. Poor metabolic control (hyperglycemia) was associated significantly and negatively with cognitive index in diabetic patients. Hyperglycemia was significantly and negatively correlated with immediate memory and attention, verbal memory, psychomotor functioning (DSST), and visuospatial memory. In conclusion, genesis of cognitive deficits in diabetic patients is complex. However, it appears from the study that such deficits do exist and may be associated with chronically poorly controlled diabetes.