Here is a very simplistic explanation in a nutshell.
Diabetes mellitus, or sugar diabetes, is a condition which effects the body's ability to deal with glucose. It occurs when there is a partial or complete lack of insulin produced by the pancreas.
The food we eat is made up of carbohydrates, proteins and fats. Most glucose, or sugar, comes from the carbohydrates. As our food digests the glucose moves into the blood stream. This triggers the pancreas to secrete insulin which regulates the sugar in the blood by allowing it to pass into the body's cells to be used as fuel, or to be stored in the liver and muscles as glycogen, for later use.
In diabetes this process is disrupted. There is either too little, or no insulin produced, or that which is produced is ineffective. As a result the glucose levels in the blood continue to rise but the body is unable to use them.
But your body still needs fuel
In order to get the fuel we need to survive, the body begins to break down its stores of fat. This is why undiagnosed or uncontrolled diabetics begin to lose weight.
Ketones are a by-product of this breakdown of fat. In the presence of insulin, ketones do not cause any serious problems.
However, in the case of an absence of insulin, or ineffective insulin, these ketone bodies will build up and cause the blood to become acidic.
This can lead to diabetic ketoacidosis or DKA. This is a serious medical condition and must be treated immediately.
If you suspect you may have diabetes mellitus, it is vital that you seek medical assistance and get a diagnosis as soon as possible.