Earlier research has shown associations between depression and Type 2 diabetes, and the latest work, published in October 2012, indicates the association is not limited to any one culture.
The journal Acta Diabetology reports a study from the Brazilian Institute of Science confirming previous studies.
Nine hundred and ninety-six people diagnosed with Type 2 diabetes and 2,145 non-diabetics were included in the study.
It was found that having Type 2 diabetes was a risk factor for emotional disorders.
People with diabetes were:

• 80 per cent more likely to have depressive episodes than participants without diabetes, and
• more than twice as likely to have recurring episodes.
  

Diabetics were more than 5 times as likely to suffer dysthymia, or the inability to find pleasure in life; and dysthymia was associated with high blood sugar levels.
Diabetics were also:

• more than twice as likely to have emotional problems along with symptoms of psychosis, and
• more than 3 times as likely to have considered suicide.
  

Poor control of diabetes was associated with worse depressive symptoms.
Do high blood sugar levels cause depression, or does depression lead to eating too many sweets, too much time on the couch, and not monitoring blood sugar levels? Or is it a vicious cycle? Whichever the cause and effect, both conditions are highly treatable.
Walking and other physical activity causes the brain to make endorphins, which are associated with feelings of overall wellbeing.
Endorphins are something like morphine, which probably explains why physical activity is a healthy addiction.
Will lowering blood sugar levels lead directly to improving mood by improving how the brain works? Possibly.
More research will tell.
If having Type 2 diabetes and its complications is a source of stress and depression, then controlling the condition should help end depression.
The second benefit of physical activity is physical and consists of burning calories, building muscle and bone tissue, and lowering resistance to insulin.
Lowering body fat can help the body to metabolize carbohydrates and sugar.
A healthful vegan diet is another good way to treat both Type 2 diabetes and depression.
Keeping your body satisfied with plenty of good nutrients helps to minimize overeating, and the fiber in fruits and vegetables slows down the metabolism of carbohydrates and absorption of sugar.
Feeling well nourished helps to keep you from feeling tired and blue, so a good diet, like exercise, is good for both conditions.
Monitoring your blood sugar and taking medications as needed is likely to help to keep your levels under control.
Having normal blood sugar levels should improve your mood if diabetes is a stressor.
And who knows? Perhaps normal blood sugar levels can affect mood directly as well.
Couldn't hurt.