This study is performed to figure out how the presence of diabetes affects the infection, progression and prognosis of 2019 novel coronavirus disease (COVID-19), and the effective therapy that can treat the diabetes-complicated patients with COVID-19. A multicentre study was performed in four hospitals. COVID-19 patients with diabetes mellitus (DM) or hyperglycaemia were compared with those without these conditions and matched by propensity score matching for their clinical progress and outcome. Totally, 2444 confirmed COVID-19 patients were recruited, from whom 336 had DM. Compared to 1344 non-DM patients with age and sex matched, DM-COVID-19 patients had significantly higher rates of intensive care unit entrance (12.43% vs. 6.58%, P = 0.014), kidney failure (9.20% vs. 4.05%, P = 0.027) and mortality (25.00% vs. 18.15%, P < 0.001). Age and sex-stratified comparison revealed increased susceptibility to COVID-19 only from females with DM. For either non-DM or DM group, hyperglycaemia was associated with adverse outcomes, featured by higher rates of severe pneumonia and mortality, in comparison with non-hyperglycaemia. This was accompanied by significantly altered laboratory indicators including lymphocyte and neutrophil percentage, C-reactive protein and urea nitrogen level, all with correlation coefficients >0.35. Both diabetes and hyperglycaemia were independently associated with adverse prognosis of COVID-19, with hazard ratios of 10.41 and 3.58, respectively.