The Haaretz newspaper on Thursday quoted Livni as saying at a recent conference that "one does not have to be a genius to see that the fence will have implications for the future border."
"This is not the reason for its establishment, but it could have political implications."
Israel has in the past contended in court that the barrier is only meant to provide security by preventing suicide bombers from entering the country. But Livni's comments reflected a belief that the fences, walls and razor wire have political implications, as the Palestinians contend.
The barrier dips into the West Bank at several points - placing 8 % of the territory on the Israeli side to encompass Jewish settlements. Palestinians say the obstacles are intended as a land grab. They prevent tens of thousands of Palestinians from reaching their jobs, schools and farmland.
Supreme Court Justice Michael Cheshin told Livni at the conference that her remarks contradicted what the state prosecution had said in court cases against the barrier.
The state has contended in court that the barrier is a temporary tool, and could be taken down or moved in the future. The Palestinians want to establish a state in the West Bank, Gaza Strip and east Jerusalem.