"A pre-emptive war, if one were actually thinking of executing that, would be catastrophic," Rice said on CNN's "Situation Room with Wolf Blitzer."
She said the "hot rhetoric" coming from both Trump and North Korean leader Kim Jong Un could move the nations closer to war.
Rice, who was US ambassador to the United Nations under President Barack Obama before becoming his top national security aide, said the United States should instead continue to rely on deterrence, the threat of a swift and massive military response should North Korea move to attack the United States or its allies, as a way to dissuade North Korea from attacking.
She said the President had articulated the logic of deterrence in his comments earlier Thursday.
"The core of what President Trump said today, discounting for the rhetoric, was if North Korea were to attack the United States, and obviously Guam is part of the United States, we would respond with the full force of our capabilities," Rice said. "That's common sense. That's deterrence. And that's the appropriate approach."
However, she said Trump's apparently improvised threat earlier in the week, that the United States would potentially respond to further North Korean threats and nuclear developments with unprecedented force, outlined a dangerous proposal.
Rice said North Korea always reacts to outside pressure "with vitriol," and warned Trump not to respond to Kim's heated rhetoric in kind.
Trump warns North Korea: US military 'locked and loaded'
Last week, the UN Security Council voted unanimously
to increase sanctions on North Korea, and Rice said those sanctions, paired with military exercises in the region, meant it was "almost inevitable" that Kim would make threats.
"We just can't react to every statement or verbal provocation," Rice said.
She added that the Trump administration had offered mixed messages, leaving it unclear where exactly the United States stood and what it would respond to.
"I think the problem is nobody is clear what the red line is," Rice said.
Previous administrations have failed
Trump has made a vocal and purposeful shift in posture from his predecessors, blasting their inability to prevent North Korea from developing nuclear weapons and missiles capable of reaching the United States.
Asked about the Obama administration's failure to rein in North Korea's weapons program, Rice said North Korea was a longstanding problem and accepted a share of the blame. She noted the Obama administration and its immediate predecessors had tried a mixture of diplomacy, sanctions, cooperation with China and "various other methods we shouldn't speak about on television."
Nevertheless, she acknowledged North Korea had continued to build its arsenal.
"You can call it a failure," Rice said. "I accept that characterization of the efforts of the United States over the last two decades."
She said the issue now is what to do in a world where North Korea, led by Kim, possessed some of the most destructive weapons in history.
Rice stressed again her assessment that preventive war would be "foolish and catastrophic" and suggested a path reliant on deterrence -- with an open door to diplomacy.