Holder, 68, who served during Barack Obama's presidency, said the current attorney general risked 'paying a price' and sacrificing his credibility on Tuesday.
Barr assigned U.S. Attorney John Durham to pursue a probe into whether there was misconduct by the intelligence community at the beginning of the Russia investigation.
Speaking at an event in Fairfax, Virginia, Holder explained that Barr needed to be 'a little more sensitive to the appearance' given by having Trump involved.
He told Fox News: 'To see how the president is now involved to help the attorney general in that effort gives me pause.'