Participating in the last Democratic presidential debate in Miami, Florida, front-runner Clinton, 68, and Vermont Senator Sanders critiised Trump for his insulting remarks against Mexicans, Muslims, women and blacks.
"Senator Sanders, do you think it's fair to call Donald Trump a racist?" the moderator asked.
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"And let us not forget that several years ago, Trump was in the middle of the so-called birther movement, trying to delegitimise the president of the United States of America," he said.
Clinton said she would engage with Trump without resorting to the kind of language that the Republican front-runner often employs.
"If I'm so fortunate enough to be the Democratic nominee, there will be a lot of time to talk about him. I was the first one to call him out. I called him out when he was calling Mexicans rapists," she said.
"When he was engaging in rhetoric that I found deeply offensive...I am pleased that others are also joining in making clear that his rhetoric, his demagoguery, his trafficking in prejudice and paranoia has no place in our political system," she said.
"You don't make America great by getting rid of everything that made America great," Clinton said.
Not satisfied with the answer, the moderator repeated the question and Clinton responded by saying, "I think it's un-American. I think what he has promoted is not at all in keeping with American values. And I am going to take every opportunity to criticise him, to raise those issues."
"I'm not going to engage in the kind of language that he uses. I think we can make the case against him if he is the nominee, by pointing out what he has said. What he claims to believe in the values he's promoting and I think that's a better way for the American people to draw their conclusions," Clinton said.
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