Background The COVID-19 pandemic disrupted the delivery of diabetes care and worsened mental health among many patients with type 2 diabetes (T2D). This disruption puts patients with T2D at risk for poor diabetes outcomes, especially those who experience social disadvantage due to socioeconomic class, rurality, or ethnicity. The appropriate use of communication technology could reduce these gaps in diabetes care created by the pandemic and also provide support for psychological distress. Objective The purpose of this study is to test the feasibility of an innovative co-designed Technology-Enabled Collaborative Care (TECC) model for diabetes management and mental health support among adults with T2D. Methods We will recruit 30 adults with T2D residing in Ontario, Canada, to participate in our sequential explanatory mixed methods study. They will participate in 8 weekly web-based health coaching sessions with a registered nurse, who is a certified diabetes educator, who will be supported by a digital care team (ie, a peer mentor, an addictions specialist, a dietitian, a psychiatrist, and a psychotherapist). Assessments will be completed at baseline, 4 weeks, and 8 weeks, with a 12-week follow-up. Our primary outcome is the feasibility and acceptability of the intervention, as evident by the participant recruitment and retention rates. Key secondary outcomes include assessment completion and delivery of the intervention. Exploratory outcomes consist of changes in mental health, substance use, and physical health behaviors. Stakeholder experience and satisfaction will be explored through a qualitative descriptive study using one-on-one interviews. Results This paper describes the protocol of the study. The recruitment commenced in June 2021. This study was registered on October 29, 2020, on ClinicalTrials.gov (Registry ID: NCT04607915). As of June 2022, all participants have been recruited. It is anticipated that data analysis will be complete by the end of 2022, with study findings available by the end of 2023. Conclusions The development of an innovative, technology-enabled model will provide necessary support for individuals living with T2D and mental health challenges. This TECC program will determine the feasibility of TECC for patients with T2D and mental health issues. Trial Registration ClinicalTrials.gov NCT04607915; https://clinicaltrials.gov/ct2/show/NCT04607915 International Registered Report Identifier (IRRID) DERR1-10.2196/39724