"We're not going to strengthen our leadership around the world by allowing politicians to insult Muslims or pit groups of Americans against each other. That's not who we are. That's not keeping America safe," Obama said.
His remarks were seen by many as a criticism of Trump, the leading contender to become the Republican party's nominee for US presidential candidate.
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Obama said during election season there is a lot of talk about America in decline. "I don't believe in it and the acts don't show it. We're doing a lot better than seven years ago."
"We are on the right side of those debate and we are not cynical", he said.
In an address to the House Democratic Issues Conference in Baltimore yesterday, Obama outlined what he called the top national security priority for Democrats -- protection of the American people and keeping them safe from terrorist attacks.
For more than a year, America has led a coalition of more than 60 countries to hunt down and destroy the Islamic State group, including with nearly 10,000 airstrikes, Obama said.
"We're not going to build progress with a bunch of phony tough talk, and bluster, and over-the-top claims that just play into ISIL's hands," he said, using an acronym for the terrorist group.
Obama said keeping the US safe and strong and respected requires using every element of the American power.
"That's how we worked to prevent a nuclear-armed Iran. And, again, you will recall that the other side was claiming this would never work, they were going to cheat," he said.
"And yet, a few months later, we now know have certified that massive amounts of existing nuclear stockpiles and their infrastructure have been dismantled or shipped out," he added.
Obama also said that the Democrats believe in innovation and the country was making good progress in generating clean energy.
"We've cut our oil imports by nearly 60 per cent, and we've cut our total carbon pollution more than any other nation on Earth. That's what we've done," he said.
Obama said at times he gets frustrated that "they don't run back the tape to what the Republicans said back then".
"Because at each juncture, every single one of the steps we took, they said the opposite. Wanted to go in a different direction, claimed that our policies would crush jobs and destroy the economy. Do people remember that?" he said.
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