Former Prime Minister has sent out a strong message to his former Labour party by predicting that the Conservative's will win the next election as a "traditional left wing party" will not attract the voters.
Blair claims that the Labour party "succeeds best when it is in the centre ground", adding that it is too left wing at the moment.
Blair said the forthcoming election could turn out to be one "in which a traditional left-wing party competes with a traditional right-wing party, with the traditional result".
He said that the Tory's will be victorious come May as he believes that some of Labour's policies, including the reinstating of the 50p income tax band, could alienate large sectors of business.
Speaking to the Economist, the former PM said: "I am still very much New Labour and Ed would not describe himself that way, so there is obviously a difference there.
"I am convinced the Labour Party succeeds best when it is in the centre ground."
Once he was pushed by the magazine for a winner in the election, Blair conceded that it is likely to be the David Cameron-led Conservatives who will win power.
Blair also questioned Miliband's argument that the economic crisis had realigned the political grounds in the UK towards the left.
"I see no evidence for that. You could argue that it has moved to the right, not left," said Blair.
Blair's harsh words come just as Miliband urged voters to head towards a "new beginning" in the form of the Labour party.
Miliband said in his annual festive message: "I don't have to tell you that all over our country today, there are people working harder and harder, but standing still.
"It doesn't have to be this way - as this New Year dawns, we have the chance to change direction."