Sajid Javid, who replaced Amber Rudd at the Home Office, said the phrase used by the Prime Minister during her time as Home Secretary does not represent British values.
It came after Mrs May defended Government targets for deporting illegal immigrants and admitted she was aware of them when she was Home Secretary.
The PM gave Mr Javid the job after her ally Amber Rudd quit, admitting she “inadvertently” misled MPs over Government targets for removing illegal migrants amid pressure over the Windrush scandal.
Mr Javid pledged he will do “whatever it takes” to put right the treatment of Commonwealth citizens, who have been wrongly denied access to benefits and healthcare or threatened with deportation despite living in the UK for decades.
He promised to put his “own stamp” on the Home Office, and said he preferred a “compliant environment” for illegal immigrants to a “hostile” one as outlined by Mrs May in 2012 comments, which some have blamed for the treatment of the Windrush generation.
Although Mr Javid stopped short of promising an overhaul of Mrs May’s policies, he said: “I think the (hostile) terminology is incorrect, I think it’s a phrase that is unhelpful and does not represent the values as a country.”
In the Commons, Mr Javid told Windrush generation migrants who had struggled to prove their immigration status: “This never should have been the case and I will do whatever it takes to put it right.”
Earlier, Mrs May defended the existence of targets during a local election campaign visit to Greater Manchester: “When I was Home Secretary, yes, there were targets in terms of removing people from the country who were here illegally. This is important. If you talk to members of the public, they want to ensure that we are dealing with people who are here illegally.”
Former investment banker Mr Javid was given the job during a telephone call with Mrs May and becomes the first person from an ethnic-minority background to hold one of the four Great Offices of State. He said: “The most urgent task I have is to help those British citizens that came from the Caribbean, the so-called Windrush generation, and make sure that they are treated with the decency and the fairness that they deserve.”
He added: “We are going to have a strategy in place that does something the previous Home Secretary set out last week, about making sure we have an immigration policy that is fair, it treats people with respect and with decency.”
Mr Javid was replaced as Housing and Communities Secretary by James Brokenshire, who has recently returned to Westminster after treatment for cancer, while International Development Secretary Penny Mordaunt took on Ms Rudd’s equalities brief.
Labour leader Jeremy Corbyn sought to keep the pressure on Mrs May, saying she must address questions about “what she actually did as Home Secretary”.
“She was presiding over, in her terms, the creation of a hostile environment,” he said.