In a withering assessment of the Labour leader’s chances of becoming the next prime minister, Mr Blair suggested that Mr Miliband risks taking Labour back to the dark days of the 1980s and early 1990s, when the party suffered a series of heavy defeats to the Conservatives.
His comments will come as a major blow to Mr Miliband and come just five months before voters go to the polls in what is predicted to be the tightest general election in decades.
The former prime minister, the most electorally successful politician in Labour history, said that May’s general election risks becomes one in which a “traditional left-wing party competes with a traditional right-wing party, with the traditional result”.
Asked by the Economist magazine if he meant that the Conservatives would win the general election in those circumstances, Mr Blair replied: “Yes, that is what happens.”
Mr Miliband has repeatedly attempted to distance himself from Mr Blair and the New Labour movement, but has faced criticism for left-wing economic policies which some have argued are anti-business.
In a thinly-veiled condemnation of Mr Miliband’s leadership of the party, Mr Blair said that Labour “succeeds best when it is in the centre ground”.
“I am still very much New Labour and Ed would not describe himself in that way, so there is obviously a difference there,” Mr Blair said. “I am convinced the Labour Party succeeds best when it is in the centre ground”.
When asked what lessons he derives from his experience of election-winning, Mr Blair replied: “Not alienating large parts of business, for one thing.”
The Telegraph in October disclosed that Mr Blair had told long-standing political allies that Mr Miliband cannot beat Mr Cameron in the election.
Mr Blair’s intervention comes just one month after Mr Miliband faced a leadership crisis after a number of MP’s from his own party questioned his ability to win the election.
At least four backbenchers called on Mr Miliband to step down amid growing concerns he is leading Labour to a heavy defeat.
A number of MPs have accused Mr Miliband of being out of touch with ordinary Labour voters, particularly in the north of England.
Although Labour has a narrow lead over the Conservatives in most opinion polls, some Labour politicians are worried that lead will not survive ever more intensive Conservative attacks on Mr Miliband’s credibility in run-up to the election.
Allies of Mr Blair also fear that Mr Miliband is not doing enough to appeal to the centre-ground voters who gave the party three general election victories between 1997 and 2005.
Since leaving Downing Street in 2007, Mr Blair has made few direct interventions in British politics, spending much of his time abroad.
However, he has repeatedly hinted at his unhappiness with Mr Miliband’s stewardship of the Labour Party.
In July, he warned Mr Miliband about retreating into a left-wing “comfort zone” and said the party has not yet developed a “narrative that is about the future of the country.”
And he in November said that Labour must show a “strong political lead” if it wants to form a majority in 2015.
A Labour Party source said: “[Tony Blair has] made it abundantly clear on several occasions he wants and expects Labour to win under Ed Miliband.”