We investigated whether pre-existing diabetes, newly-diagnosed diabetes, and admission hyperglycemia were associated with COVID-19 severity independently from confounders. Methods: We retrospectively analyzed data on patients with COVID-19 hospitalized between February and April 2020 in an outbreak hospital in NorthEast Italy. Pre-existing diabetes was defined by self-reported history, electronic medical records, or ongoing medications. Newly-diagnosed diabetes was defined by HbA1c and fasting glucose. The primary outcome was a composite of ICU admission or death. Results: 413 subjects were included, 107 of whom (25.6%) had diabetes, including 21 newlydiagnosed. Patients with diabetes were older and had greater comorbidity burden. The primary outcome occurred in 37.4% of patients with diabetes compared to 20.3% in those without (RR 1.85; 95%C.I. 1.33-2.57; p < 0.001). The association was stronger for newlydiagnosed compared to pre-existing diabetes (RR 3.06 vs 1.55; p = 0.004). Higher glucose level at admission was associated with COVID-19 severity, with a stronger association among patients without as compared to those with pre-existing diabetes (interaction p < 0.001). Admission glucose was correlated with most clinical severity indexes and its association with adverse outcome was mostly mediated by a worse respiratory function. Conclusion: Newly-diagnosed diabetes and admission hyperglycemia are powerful predictors of COVID-19 severity due to rapid respiratory deterioration.