Speaking to Croatian reporters on the margins of the GLOBSEC security conference in Bratislava, she said quotas "can be a short term solution, but the solution must be comprehensive."
She said that if the quota system sent illegal immigrants the message that they could stay in the EU in the end, "we will only perpetuate the problem and it will become worse."
The EU and the UN must work to solve the root problems of illegal immigration, which means dealing with the conflicts in Iraq and Syria, fighting poverty and the reasons which make people leave north Africa and the Middle East, she said.
She also underlined the need to step up the fight against human traffickers, saying Croatia would take part in it in accordance with its possibilities.
"Illegal immigration is a 21st century security threat and we must be ready, because one day they might be coming to the Adriatic coast. Our Navy and Coast Guard should be strengthened," Grabar-Kitarovic said. The solution is in European solidarity but there is also need for a vision of what the EU wants and can do to protect its economies and security, she added.
Last night she took part in the panel "Balkan Chessboard: Europe Whole and Free at Stake?" together with Macedonian President Gjorge Ivanov, Hungarian Foreign Minister Peter Szijjarto, and former European enlargement commissioner Stefan Fuele.
The EU must send strong messages to Southeast European countries, encouraging them to implement reforms, and they should implement them so that citizens can live better, not because they have to, Grabar-Kitarovic said, adding that reforms were always difficult in the beginning.
She went on to say that security prospects were gloomy this year because of the Ukraine situation and that a political solution, "full respect for the Minsk agreement," was the only option.
"We must be very firm and say that we won't allow the undermining of the principles of international law and order, which are state sovereignty, territorial integrity and the right of every state to decide on its future. We see this today in Ukraine, but slowly in our neighbourhood too. The EU or NATO membership of neighbouring states is being brought into question as something that would threaten the security of others. That's simply not true. Stable democratic states can't threaten anyone's security," the Croatian president said.