Background Type 2 Diabetes Mellitus (T2DM) is a chronic disease which is growing global health problems. However, research on such prediction of health-related quality of life (HRQOL) in Thailand is limited, in particular on the demographic and clinical characteristic in each HRQOL domains. Therefore, the aim of the present study was to determine the demographic and clinical predictors of health-related quality of life among people with type 2 diabetes mellitus (T2DM) in Northern Thailand. Methods A cross-sectional study of people with T2DM at a large teaching hospital in Northern Thailand was conducted. The HRQOL was evaluated using the Thai version of Diabetes-39. Descriptive analysis was used to summarize the demographic and HRQOL scores. Multiple regression analysis was used to determine the predictors of overall HRQOL and the predictors of each D-39 dimension. Results A total of 502 people with T2DM were recruited. Forty-one were identified as having diabetic foot ulcers. The mean score for perception of overall HRQOL was 61.18 (SD 18.74). Scores in the D-39 questionnaire showed a poor HRQOL among people with T2DM. The predictors of demographic and clinical characteristics of people with T2DM were calculated for overall HRQOL and all six domains. Conclusion These results demonstrate that people with T2DM have a poor HRQOL. The presence of diabetic foot ulcers and smoking status were identified as significant predictors of low HRQOL in the domains relating to diabetes control, social burden and energy and mobility presence of obesity, receiving insulin injection or a combination of insulin and oral medication were predictors of poor HRQOL in the domain of other health problems and diabetes complications. These findings allow for a nursing care plan for diabetes management to achieve optimal glycaemic control and improve their HRQOL.