It could actually be a skin condition. How is the control of your diabetes? Some skin conditions are more likely to occur in diabetics and even more likely if control isn't great.... psoriasis for example. It can start in small patches and develop more and more (usually mirrored on both sides of the body). I'd see your GP if I were you, to get a diagnosis. Be warned though, it took me a LONG time to get a proper diagnosis and referral to a specialist dermatologist because the GP insisted it was just a fungal thing.
Of course, it may not be a skin condition at all... either way, being diabetic, I'd definitely go to see your GP! Good luck!