In a televised debate, candidate Norman Lamb said he believed people with a terminal illness had the "right to decide" to end their life.
During the discussion on the BBC, Mr Lamb said: "We agree on an awful lot. There are things we disagree on. Assisted dying is one where Tim, because of his faith and I totally respect that, takes a position.
"I fundamentally believe that it's a liberal issue that if you, in a position of terminal illness, want to make a decision to end your life it should be you, not the state, that decides.
"I think that is a fundamental point about the rights of the individual against the state."
Mr Farron hit back, insisting his position was "more to do with the evidence" than his Christian beliefs.
He also defended his views on abortion, insisting that while he backed the current laws, "we need to constantly look at the science and medical advice".
"What is acceptable and what is possible at one time can change five or 10 years on," he added.
Mr Lamb and opponent Tim Farron both conceded the party faced a major challenge trying to win back the trust of voters after five years in coalition.
Mr Lamb said coalition "crushed" the Lib Dems, but insisted the party had been right to go into government with the Conservatives.
Mr Farron said the tuition fees row had been about the broken promise rather than the policy.
