"This missile test is sending a message from Kim Jong Un that he is not deterred. And that's what I mean about all the tough talk that we hear from our president, really actually playing right into Kim Jong Un's hands," she said.
"And that's what I mean when I say he's been played," she said.
She also blasted the Trump administration, saying the State Department had been decimated, reported The Hill's briefing room blog.
"We have decimated our State Department. Foreign service officers with decades of experience have either been ignored or in some cases pushed so hard that they have resigned," the former secretary of State told MSNBC.
Mrs Clinton went on to argue that there was no strategy in the department under Secretary of State Rex Tillerson.
"There's no real plan. What I hear from inside of the department, because I still have a lot of communication coming to me, is that there's a very small group of people around Tillerson, none of them experienced diplomats that he has brought in to be his palace guards, so to speak," she said.
Mr Trump has taken an aggressive stance against North Korean as the country continues to make advances in its nuclear and missile programmes, and has indicated that military action against the Kim Jong Un regime is not out of the question.
Mrs Clinton, who served as secretary of State under former President Barack Obama, suggested the Trump administration bring in experienced diplomats from outside the government if it does not have the capacity to negotiate with North Korea.
She said that "right now we need smart, diplomatic intervention" on the issue.
"They don't even reach out into the State Department to talk to the people who have studied North Korea for years. So they're not getting the expertise and experience that is still at the State Department."
Mrs Clinton's comments came as Mr Tillerson revealed plans to reform the State Department, potentially slashing billions from its budget over the next five years and shaving nearly 2,000 jobs through reforms.
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