Clinton alleged that Trump's remarks have become inflammatory in the aftermath of the Orlando terrorist attack by an Afghan-origin American youth.
68-year-old Clinton said it is apparent that Donald Trump does not seem to grasp any of the issues.
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Trump, she alleged, wants to ban all Muslims from entering our country and suspend immigration from large parts of the world.
"His comments have become even more inflammatory in recent days. This approach isn't just wrong; it is dangerous," Clinton said in a major policy speech on terrorism in Virginia.
"Of course we want to keep our country safe...But I want to underscore we rely on partners in majority Muslim countries to help us fight terrorists. We need to build trust in Muslim communities here at home to counter radicalisation and the one wolf phenomenon," she argued.
Clinton said Trump's claim on birth of the Orlando shooter who killed 49 people at a gay nightclub was factually wrong.
"As has been pointed out, the terrorist in Orlando was not born in Afghanistan, as Trump claims, he was born in Queens, New York, only miles away from where Donald Trump himself was born," she said.
"A ban on Muslims would not have stopped this attack. Neither would a wall. I don't know how one builds a wall to keep the Internet out. So not one of Donald Trump's reckless ideas would have saved a single life in Orlando. It's just more evidence that he is temperamentally unfit and totally unqualified to be Commander-in-Chief," she said.
In a passionate speech, Clinton said the US deserves a Commander-in-Chief who will provide smart, steady leadership.
She said if elected in the November general elections her top priority would be to identify and stop attacks by lone wolves, like the one on Orlando over the weekend resulting in deaths of 49 people.
"As President I will make identifying and stopping lone wolves a top priority. We will assemble a team from across the government, private sector and our communities to get on top of this challenge," Clinton said.
Clinton said as president she will make sure that the law enforcement and intelligence professionals have all the resources they need.
"Second, we do need to stop terrorists from getting their hands on the tools to carry out attacks so easily, especially assault weapons, military- style assault weapons, that have no place on our streets," Clinton said as she laid out her action plan to prevent a repeat of Orlando-type mass shooting by a self-radicalised youth.
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