"A foreign force occupied an Arab country and hanged its president and we stood by and watched," he told an Arab summit in the Syrian capital.
Saddam was hanged in December 2006 after being sentenced to death for crimes against humanity over the mass killing of Shiites in the 1980s.
"How can they execute a prisoner of war and the president of a member of the Arab League?" Kadhafi asked.
He said Saddam had been a friend of the United States during the Iran-Iraq war in the 1980s "before they turned against him and executed him."
"You could all suffer the same fate," he warned.
Kadhafi warns US allies could suffer Saddam's fate
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