Introduction Type 2 diabetes mellitus (T2DM) is characterized by elevation of blood glucose levels due to underlying insulin resistance and inflammation. Multiple modifiable risk factors such as unhealthy dietary habits, physical inactivity, obesity, smoking and psychological stress contribute to T2DM. We investigated the efficacy of a comprehensive functional nutrition approach aimed at mitigating T2DM using the iTHRIVE approach which encompassed anti-inflammatory and elimination diets, micronutrient supplements, physical activity, stress management and environmental modifications through a pre-post study design. The research assessed changes in blood glucose and inflammatory markers following the implementation of the functional nutrition program. Methods A prospective pre-post intervention pilot study was conducted at ThriveTribe Wellness Solutions Pvt Ltd. (iTHRIVE), where 50 study participants from urban areas of Pune city, India (n=25 each group) were recruited voluntarily in the age group of 20-60 years. The participants were subjected to 90 days of the iTHRIVE functional nutrition approach which consisted of eliminating certain inflammatory foods and adding a combination of nutritious organic foods, adding dietary supplements like magnesium, vitamin D, alpha lipoic acid, chromium picolinate, berberine and biogymnema, physical activities like resistance training, stress reduction techniques like meditation and deep breathing exercises along with environmental changes. The blood parameters like fasting blood glucose, postprandial blood glucose, glycated haemoglobin (HbA1C), fasting serum insulin, post-prandial serum insulin, high sensitivity C-reactive protein (hs-CRP), erythrocyte sedimentation rate (ESR), vitamin D, body weight and waist circumference were measured before and after the intervention. The changes were statistically analyzed using a paired t-test. Results The mean age of the participants was found to be 43.76±10.58 years. Around 68% of the participants were prediabetic (HbA1c: 5.7-6.4%) and 32% had T2DM (HbA1c ≥6.5%). A significant reduction was observed in the average HbA1c (13.75% reduction, p<0.0001), average post-prandial blood glucose levels (14.51% reduction, p<0.048), average post-prandial serum insulin (34.31% reduction, p<0.017) and average ESR levels (34.51% reduction, p<0.006). The hs-CRP levels were reduced by 6.6%, but not statistically significant. The average body weight of the participants dropped from 78.59±15.18 kg to 75.20±14.20 kg with a mean loss of 2.91 kg (p<0.05) whereas the waist circumference decreased from 37.54±5.09 to 35.97±4.74 inches with an average loss of 1.19 inches (p<0.0004). Conclusions Following the intervention, several health indicators indicated significant improvements. Particularly, there was a significant drop in HbA1c levels, suggesting better long-term blood glucose control. Blood glucose and serum insulin levels after a meal dropped significantly, indicating enhanced insulin sensitivity. There was a decrease in systemic inflammation as evidenced by the decrease in ESR levels. These results imply that the iTHRIVE functional nutrition approach used in this investigation might be beneficial for enhancing glycemic control and insulin sensitivity, along with reducing inflammatory markers in people with prediabetes and T2DM. Larger sample sizes and longer periods of monitoring would be useful in subsequent research to validate and build on these encouraging findings.