Diabetes is in essence a condition where there is lack of regulation of glucose levels in the blood. The glucose level in the blood is normally regulated closely by the affects of hormones, of which insulin plays the most important role. Insulin causes the uptake of glucose into cells from the blood stream. When the glucose level increases, secretion of insulin is stimulated and blood insulin levels rise. This causes uptake of glucose into the cells and a fall in blood glucose. Insulin secretion then falls as blood glucose falls.
When the body looses the ability to secrete enough insulin, or the body becomes resistant to the insulin that is secreted, there is in essence a functional lack of insulin effect and blood glucose rises. This has two main effects, firstly blood glucose rises and secondly the cells lack a supply of glucose.
As blood glucose rises more glucose is filtered by the kidney and this soon overcomes the ability of the kidney to reabsorb it so glucose is passed in the urine giving it a sweet taste. As the glucose is lost from the kidney into the urine the glucose carries water with it so the total volume of urine lost increases causing the siphon effect. This effect of glucose is as an osmotic diuretic.
When cells lack glucose, they have to change their metabolism to allow for the effects of the lack of the normal fuel supply, which is glucose and oxygen. Cells start to digest fat and by products of fatty metabolism accumulate in the blood stream and some spill out into the urine. One of the main alternative metabolic routes results in the accumulation of acetone like compounds in the blood. This is termed diabetic ketoacidosis. These acidic compounds change the acidity of the blood and the lungs try to get rid of acid by increasing ventilation (breath more deeply with each breath and increase the rate of breathing) and blowing off carbon dioxide, which in effect lowers the bodies acid level. People in diabetic ketoacidosis, often breath deeply and more frequently than normal and the smell off their breath is acetone.