Diabetes mellitus remains one of the most challenging metabolic diseases in the world, largely because of the disease's progressive nature and the shortcomings of existing treatments. Nanotechnology has emerged as a promising tool to address these problems because it provides innovative methods for monitoring, diagnosis, and treatment. Nanocarriers, including injectable and oral systems, have been thoroughly studied for controlled and sustained insulin delivery, as glucose-responsive nanoparticles have demonstrated promise for self-regulated insulin release and extended glycemic control. The accuracy and compliance issues with current methods may be resolved by the development of highly sensitive, real-time glucose monitoring using nanosensors and implantable devices in parallel. Nanomaterials have been investigated for immunomodulation and islet cell encapsulation in addition to glycemic control in order to prolong and improve the survival of transplanted beta-cells. In addition to improving wound healing in the treatment of diabetic issues, nanocarriers have therapeutic potential in the treatment of retinopathy, nephropathy, and neuropathy. Recent advances have brought attention to precision nanomedicine approaches for targeted drug delivery, nucleic acid-based therapies, and integration with state-of-the-art technologies like biosensors and smart delivery platforms. Despite recent progress, translational barriers remain in the areas of safety, large-scale manufacturing, and regulatory concerns. All things considered, the information that is currently available shows how revolutionary nanotechnology can be in the treatment of diabetes, but it also emphasizes the need for extensive testing before widespread clinical use.