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Background and Objectives: Continuous glucose monitoring (CGM) improves glycemic control in type 2 diabetes (T2DM), but its effects on diabetes-related distress and quality of life (QoL), particularly in patients on intensive insulin therapy, are less well studied. Aim: We aim to assess the impact of CGM on glycemic control, diabetes distress, and QoL in adults with T2DM on intensified insulin therapy. Materials and Methods: This prospective observational study included 226 adults with T2DM using multiple daily insulin injections or basal-bolus therapy. CGM was initiated at baseline. HbA1c, fasting glucose, and lipid profile were measured at baseline, 3, 6, 9, and 12 months. Diabetes-related distress (DDS-17) and quality of life (MDQoL-17) were assessed at the same time points. Longitudinal changes were analyzed using linear mixed-effects models. Results: Mean age was 66 ± 9.1 years; 55% were male. HbA1c decreased from 8.56 ± 1.87% to 7.20 ± 0.90% at 3 months (p < 0.001) and remained improved at 12 months (7.21 ± 1.04%). Diabetes distress declined significantly over time (β = -0.025/month; p = 0.001). Older age and lower income were associated with higher distress. Quality of life improved significantly during follow-up; higher income predicted better QoL, while greater distress predicted poorer QoL. HbA1c did not independently influence QoL. CGM metrics (GMI, mean glucose, TIR, glycemic variability) remained stable after initial improvement. Conclusions: In 226 insulin-treated T2DM patients, implementation of CGM as part of a structured insulin intensification strategy was associated with sustained improvements in glycaemic control, reduced diabetes-related distress, and enhanced quality of life over 12 months. These findings support routine CGM use and highlight the importance of addressing psychosocial outcomes in diabetes care.