David Blunkett is using a "climate of fear" to push through some severe restrictions on people's freedom, the Liberal Democrat leader has said.
Mr Kennedy criticises the home secetary
Charles Kennedy accused the home secretary of using the backdrop of terrorism to introduce some "extremely repressive measures".
These included plans to cut the right to jury trials and bring in ID cards.
The comments came as Mr Kennedy set out his party's alternative to the Queen's Speech, due to be unveiled next week.
"By using the populist rhetoric of the right wing tabloids he has encouraged a climate of fear which provides an alarming backdrop as he has attempted to force through some extremely repressive measures."
Mr Kennedy also cited the indefinite detention of terrorist suspects without
charge or trial.
Launching the party's alternative legislative plans, Mr Kennedy pledged to defend the "hard-won civil liberties" that have served "generations of Britons very well".
"I am determined that the Liberal Democrats will continue to be the effective opposition in defending our
"In the dying days of this Parliament we will hold this administration to account for its illiberalism."
The government's central plan was to tackle crime and terrorism but it should be to help the elderly and students, Mr Kennedy said.
His party's priorities for the next session of Parliament would be scrapping tuition fees and the council tax, boosting pensions for over-75s and introducing free personal care for the elderly.
The Lib Dems would also modernise the police force and boost police numbers by 100,000 with the cash ear-marked for ID cards.
Green issues would be put at the heart of policy making, Mr Kennedy added.
The Conservatives dismissed the Lib Dem plans and urged the party to set out how they would fund the 100 spending commitments they had made.
Co-chairman Liam Fox also urged Mr Kennedy to "explain why he believes that convicted criminals should not go to jail".
He also urged Mr Kennedy to set out why he thinks the European Union would be better placed to sort out the country's "shambolic asylum system" than the UK government.