In diabetes, kidneys start getting damaged.

Protein starts leaking in the kidneys and kidneys start getting more and more damaged and it leads to diabetic nephropathy (as we call it).

So, kidneys start losing function plus there is a lot of sugar spills over in kidneys also, and sugar is an osmotic agent, it takes lot of water with it, so you become dehydrated also,

But eventually most important is protein damages the kidney or the filtering unit starts getting damaged.

Eventually, kidneys clean less and less the blood and a time comes when we need to be on dialysis.

Without dialysis, everyone will die in less than 6 months. (Although it is a very painless sleepy dying process) an individual slowly drifts into a sleepy coma  and dies.