The Tanaiste has signalled a shift in emphasis in Progressive Democrats policy by calling for a new focus on social inclusion.
Ms Harney said the quality of life in Ireland had declined despite increased prosperity and she called on people who were doing well from the boom "to make a contribution to wider society".
Speaking to voluntary groups dealing with social inclusion, Ms Harney said Ireland "is not that friendly a place to people who are different.
"We've transformed this country in many respects. Matters that seemed impossible, that weren't even a dream a few years ago, have become a reality," she told the meeting.
However, Irish people needed "to move to a society where people are at the centre, not at the margins", the PD leader said.
"The quality of life has deteriorated, and I'm not just talking about traffic problems. The sense of voluntarism that was so strong in Ireland in the past, I think we are losing some of that."
Ms Harney told the meeting of groups supported by the EU Integra fund in Dublin's Mansion House that there was a need for greater social inclusion.
"We live in a society where opportunity can be grasped by those who are given the assistance, and sometimes it is not a great amount of assistance that's required . . . I do think we need to mobilise people to make a contribution to wider society.
"We can, as a society working together in a partnership way, turn things around for the too many that are still at the margins in the Ireland of the year 2000."
Ms Harney's comments will be seen as a response to Opposition criticism of Coalition budgets as being too focused on the middle class and not sufficiently concerned with social inequalities.
She said there was a need "to move away from national criteria and have a flexible approach" when it came to programmes designed to assist the disadvantaged.
"We need to look at what we're doing and the impact that it has on the individuals it is supposed to serve."
She expressed concern about solvent abuse, which she said had "become a much bigger issue than I could have imagined", and said she was alarmed by the high levels of illiteracy.
"Even those that are out of education less than 10 years have very high levels of illiteracy. . .The sad reality is that thousands of jobs that are being created in our society at the moment cannot be accessed by people who are unemployed. We have to equip people with the skills for employment in a modern economy."
Ms Harney said a lot of "unsavoury matters" had been revealed by the work of the tribunals, which showed "society perhaps being run in the interests of a tiny few.
"Their interests were confused in so many cases with the national interest."
On the broader issue of social inclusion, she said there was an unfriendliness not just towards asylum-seekers, but also towards Irish people "who are different". Such people did not get the respect they merited as full Irish citizens, Ms Harney added.
