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There is a high prevalence of co-morbid depression in people with diabetes. Depression is a mental disorder that is associated with worse physical outcomes in diabetes, in particular higher rates of diabetes complications and mortality, but it is often undetected and undertreated. The mechanisms underlying the high rates of depression and its adverse effects are not well understood but appear to include both biological and psychological processes. Depression may have a more chronic course in people with diabetes compared to those without diabetes. The current evidence for the treatment of depression in diabetes suggests that treating depression improves mood but its effectiveness in improving glycaemic control is poor.