Background and objectives Diabetes is a leading cause of kidney failure in various regions worldwide. To detect renal disease in individuals with diabetes, screening typically involves evaluating the glomerular filtration rate and measuring albuminuria. Although there are established guidelines for these screenings, adherence to them varies. This study aims to examine the prevalence of albuminuria screening among adults with diabetes mellitus (DM) and to assess the different practices in managing these patients across primary and tertiary care settings. Methods This cross-sectional observational study involved adult patients with DM attending outpatient clinics in both primary and tertiary care settings. Patient data were gathered using a standardized form, excluding those with established chronic kidney disease (CKD) who were under nephrology care. Results The study included 1,010 patients, with 303 (30%) from primary care clinics and 707 (70%) from tertiary care clinics. The cohort comprised 582 (58%) females, with a median age of 62 years (IQR: 55-70), and approximately 990 (98%) had type 2 DM (T2DM). Annual albumin-to-creatinine ratio (ACR) screening was conducted for 498 out of 1,010 patients (49%) (95% confidence interval {CI}: 46%-52%). Screening compliance was notably higher in primary care settings compared to tertiary care clinics. Older patients (over 60 years) and those with hypertension or cardiac conditions were less likely to undergo screening. Among those screened, 185 of 498 patients (37%) (95% CI: 33%-41%) had abnormal albuminuria (ACR > 3). Conclusion Albuminuria is a significant indicator of progressing renal disease and cardiovascular risk. The annual screening rate for albuminuria in diabetic patients is inadequate. Primary care physicians show better adherence to screening guidelines compared to their tertiary care counterparts. Increasing physician awareness about the importance of screening could improve guideline compliance and mitigate the adverse effects of albuminuria.