High blood sugar levels can damage nerves, they can also cause damage to the blood vessels. I
Nerves
Your feet are at the far end of long nerves so that is an area where damage may cause problems.
1)
Damage to nerves can cause a loss of sensation. This loss of sensation to the foot can mean that people don't feel pain if they cut themselves, tread on a needle, develop a blister or step into a very hot bath.
2)
Nerves also help the body to control muscle movement. Damage to these nerves may mean that your muscles don't support the foot correctly causing it to change shape (clawed toes, flattened arches). Tiny bones may be damaged and not repair (see below for why) resulting in very deformed feet which can't support normal walking. . Because of the lack of sensation people may not notice it happening
3)
Nerves also control the bodies reaction to heat and cold. They control sweating. Sometimes this results in insufficient sweating in the foot resulting in dry, cracking feet.
Blood vessels
If your blood vessels become blocked or restricted. There may be an insufficient blood supply to the foot. (again at the end of long vessels)
People need a good blood supply to heal damage (ie the right amount (won't go into detail here but some lack of nervous contol can cause too much blood flow which can also cause damage)
If your feet are damaged as above then they may not heal well. This means that small cuts, blisters etc may develop into large non healing wounds.
People with diabetes need to be aware of the problems, keep glucose levels low. Most people would say this also applies to cholesterol levels. Smoking also seems to contribute to both nerve and blood vessel damage.
They should keep an eye out for any cuts/blisters etc. They should also make sure that their doctor/nurse regularly tests their feet for loss of sensation and also checks the pulses in their feet (pedal pulses)to check that circulation is OK .