Speaking on the BBC's Talking Point on Air, Mr Butler said sanctions harmed the Iraqi people and had not realised their declared aim of stripping Iraq of weapons of mass destruction (WMDs).
"I deeply believe that sanctions as now applied to Iraq have been utterly counterproductive for this disarmament purpose," Mr Butler said.
He was responding to a question from an Iraqi caller from Germany who had accused him of being instrumental in the imposition of "murderous" sanctions against Iraq.
"I'm not trying to shirk responsibility.
"I'm not just splitting hairs by saying sanctions were not my responsibility, I'm stating a fact," he said.
Confrontations
Mr Butler stressed that Unscom's job was solely to report to the UN Security Council on progress towards Iraqi disarmament.
As the body's chief, Mr Butler was well known for confrontations with Iraqi officials over access to weapons sites.
He was accused by Iraq of being a tool of the US, which Baghdad said had no intention of lifting sanctions regardless of progress on disarmament.
Inspectors have not returned to Iraq since they withdrew in December 1998 ahead of a US-led bombing campaign, and Baghdad has refused to accept a reconstituted inspection regime.
'Double standards'
Mr Butler put forward his theory, expounded in a recently published book, that sanctions need to target the Iraqi leadership rather than the ordinary people of Iraq.
He also suggested that unity and collective action by the Security Council was vital, while divisions had stopped progress in disarmament which benefited Baghdad.
Mr Butler also answered critics of "western double standards" towards Arab states and Israel, which like Iraq has invaded its neighbours and maintains a WMD arsenal.
He agreed there was a double standard, and Israel's nuclear weapons had been a "source of very great difficulty" when it came to Unscom's work.
"In the last chapter of my book I make very clear that as we move towards nuclear disarmament as we must that Israel's weapons have to be put on the table," he said.
Mr Butler retired from Unscom in 1999 and is now Diplomat in Residence at the Council on Foreign Relations in New York.