Writing in The Guardian newspaper, she also criticised what she described as a policy of non-engagement with Britain's three million Muslims, leading to a lack of trust.
Baroness Warsi claims the Muslim community is currently beset by a climate of concern, worry and fear, she said: "We needed to bring more people into the fold rather than increasingly adopt positions which pushed groups and individuals out to the fringe"
She cites the refusal by the coalition to establish a Muslim equivalent of the Jewish Leadership Council (JLC) which arranges for community figures to share their views directly with the prime minister.
"I've argued for a long time that the prime minister should hold a similar event with Britain's other major faith communities, but sadly this has not been forthcoming," she says.
Warsi resigned as a senior Foreign Office minister in August last year, citing the government's "morally indefensible" policy on Gaza.
Elsewhere today, leaders of Muslim and Jewish community and faith groups, together with politicians, Christian faith leaders, and communal organisations are committing to challenge hate speech and intolerance, in the wake of the recent Paris terror attacks.
They'll sign a declaration in London condemning unequivocally anti-Semitic, anti-Muslim and xenophobic speech and actions, while committing to work together to challenge expressions of hostility and incitement within their our own communities.
The signing is organised by the Mayor of Camden and his charity of the year, 3FF (the Three Faiths Forum), and is in partnership with the Islamic Society of Britain, Holocaust Memorial Day Trust, the British Albanian Kosovar Council, JW3, Radical Middle Way, UK Jewish Film, Rumi's Cave and Faith Matters.