Kerry used the Democratic party's weekly radio address on Saturday to appeal for a dramatic change to policy in the country US forces invaded in March 2003 and where they are still struggling to restore order.
"Staying the course does not mean stubbornly holding to the wrong course," said the Massachusetts senator who will take on Bush in the 2 November presidential election.
"In order to complete our mission, we must review our tactics. We need strategies that reflect realistic goals and the facts on the ground."
Kerry said Bush and other US leaders had to be "honest with the American people about the difficulties we face in Iraq" and more troops had to be be sent to secure Iraq.
"Third, we must remove the Made in America label from the Iraqi occupation." Kerry said an international mission approved by the United Nations had to be set up to organise elections, restore government services and help rebuild the Iraqi economy.
Rising unrest in Iraq has turned it
into a major US campaign issue
"Finally, we should transform the military force in Iraq into a NATO security force under the leadership of an American commander, so that the United States is not shouldering the burdens and risks alone."
Kerry said: "The failure of the administration to internationalise the conflict has lost us time, momentum, and credibility.
"Our stubborn, unilateral policy in Iraq has steadily drifted from tragedy to tragedy. Our troops deserve better."
Mounting unrest in Iraq has turned the occupation into a major campaign issue. Kerry's comeback in opinion polls over the past two weeks has been largely attributed to US difficulties in Iraq.
Kerry has also lashed out at Vice President Dick Cheney and White House senior adviser Karl Rove, for questioning his patriotism while they did not serve in the military.
Kerry referred to Cheney and Rove by name at a Pittsburgh rally, noting that they both "went out of their way to avoid" to service during the Vietnam war, The Washington Post reported on Saturday.
The campaign of President Bush - Kerry's presumptive rival in the 2 November presidential election - has been airing a television commercial questioning Kerry's judgment on national security issues.
"I'm tired of Karl Rove and Dick Cheney and a bunch of people who went out of their way to avoid their chance to serve when they had the chance. I went [to Vietnam]. I'm not going to listen to them talk to me about patriotism," Kerry said.
A Bush campaign spokesman told the Post that Kerry's attacks were misguided and outrageous. "Nobody has ever questioned his patriotism," said spokesman Steve Schmidt. "What's in question is John Kerry's judgment."