The grizzled veteran of heightened military tensions believes if both sides fail to halt the slide then “anything is possible”.
The eighth and final leader of the Soviet Union said: “The rhetoric used by politicians and senior military commanders is becoming more and more belligerent.
“All the indications of a Cold War are there.”
Vladimir Putin has previously condemned the arrival of more than 3,000 soldiers in Poland and claimed it is a threat to Moscow’s security.
Mr Gorbachev added: “Troops are being moved into Europe, including heavy equipment such as tanks and armoured cars. It was not so long ago that Nato troops and Russian troops were stationed quite far away from each other.
“They now stand nose-to-nose. One gets the feeling that the world is getting ready for a new war.”
Mr Gorbachev claimed the West should not hold Russia to the same democratic standards or hope that economic sanctions will cause change.
He continued: “Russia is on the path to democracy. It’s half way between. There are approximately 30 emerging nations that are in transition and we are one of them.
“Don’t have any false hope in this respect! We are a people willing to make whatever sacrifices we need to.”
Once an ardent critic of Putin for “castrating the political system”, the former president of the Soviet Union has accused the West of “provoking” Russia.
The comments were in tandem with the Kremlin’s top ambassador in London who claimed the UK’s relationship with Russia has hit an all time low and the Governments actions have been “provocative” and even “outright ridiculous”.
The diplomat spoke candidly about Rex Tillerson, the US Secretary of State’s, use of the word “ultimatum” and claimed it is closely “associated with a declaration of war”.