Her comments came as Terry Jones, the pastor behind the event, said he still planned to go ahead with the ceremony, but indicated he was praying for guidance.
Mrs Palin, the former governor of Alaska, said: “Book burning is antithetical to American ideals.
“People have a constitutional right to burn a Koran if they want to, but doing so is insensitive and an unnecessary provocation – much like building a mosque at Ground Zero.”
Mrs Palin urged Pastor Jones to reconsider the possible effects of their planned gesture, which has drawn expressions of outrage from around the globe.
“It will feed the fire of caustic rhetoric and appear as nothing more than mean-spirited religious intolerance. Don’t feed that fire,” she said.
“If your ultimate point is to prove that the Christian teachings of mercy, justice, freedom, and equality provide the foundation on which our country stands, then your tactic to prove this point is totally counter-productive.”
Mr Jones has come under fire in his church’s hometown of Gainesville, USA for using his own flock to work in an antique and used furniture business owned by him and his wife, Sylvia.
While the pastor moves between two homes, a $300,000 house in Slidell, Louisiana and a holiday apartment in Tampa, Florida his unpaid workers, motivated by their Christian beliefs, live in low rent accommodation owned by Mr Jones.
The pastor has repeatedly refused to answer questions over how what percentage of the profits generated his company and the unpaid workers goes to the church, only conceding that only “at least a portion” is donated.
Shane Butcher, who was expelled from the Dove World Church for disobeying Mr Jones, told the Gainesville Sun newspaper that he worked for the pastor’s TS and Company for up 72 hours a week without pay, meals were provided from a “food bank”.
Mr Butcher said that punishments for disobedience ranged from cleaning the barnacles off Mr Jones’ private boat in Tampa, to carrying a life-size wooden cross or writing out all of Psalm 119, the longest chapter in the Bible.”
“We carried a card that said ‘obedience is always blessed’,” he said.
Jennifer and Daniel Engel, a German couple, travelled to Gainesville on special religious work visas hoping to do mission work but quickly found themselves working in the furniture business.
Mrs Engel said that when her husband decided to return to Germany she was instructed by a senior church pastor to divorce him.
“The church totally ruled our lives, who can I marry, what can I do,” she said.
Police in Florida’s city of Gainesville are braced for violence at Saturday’s book burning after gun-toting members of the Dove World Church’s congregation threatened to bring their weapons as a “precaution” against attacks from Muslims.
Mr Jones has confirmed that he has started wearing a .40-calibre pistol strapped to his hip since announcing his Koran burning ceremony to mark the ninth anniversary of the September 11 terrorist attacks.
Despite growing global criticism, Mr Jones vowed: “We are still determined to do it. Instead of us backing down, maybe it’s time to stand up. Maybe it’s time to send a message to radical Islam.”
Angelina Jolie, the Hollywood actress, joined the growing number of people voicing concern at the Koran burning event.
“I have hardly the words that somebody would do that to somebody’s religious book,” she said, during a visit to Pakistan.
The Vatican condemned “an outrageous and grave gesture against a book considered sacred by a religious community”.
On Tuesday, Gen David Petraeus, the US commander in Afghanistan, said that the book burning would endanger the lives of American troops after Kabul protesters on Monday burned the stars and stripe and effigies of Mr Jones.
As Afghan police were placed on alert for the weekend, Hillary Clinton, the US secretary of State, echoed “clear, unequivocal condemnation of this disrespectful, disgraceful act”.
Emma Jones, the pastor’s daughter from his first marriage, has described her father’s church as a “cult”.
“They used mental violence,” she said last year. “They’d say, ‘If you’re not obedient, God will punish you’.”
Wayne and Stephanie Sapp, two senior members of Mr Jones’ congregation, brandished hand guns as they warned that they were ready to defend the book burning using force.
“We believe strongly this is something God has called us to do,” said Mr Sapp.
“We feel lives are in danger whether we do it or we don’t do it. With the amount of threats we have received, we are taking precautions.”
Local police have voiced their concern over the prospect of an armed gathering.
“We are expecting an increased amount of people at the church this Saturday so we will have a heightened presence there as well. Anytime someone is carrying a firearm, even though it is permitted, it is a concern to us,” said Corporal Charon Senn, a spokesman for the Gainesville police department and Alachua County sheriff’s office.