The three-year-old Alternative for Germany party, which harshly opposes Chancellor Angela Merkel's liberal refugee policy, plans to adopt an anti-Islamic manifesto at a conference this month.
The chairman of the Central Council of Muslims in Germany Aiman Mazyek charged that "the AfD is riding a wave of Islamophobia".
"It is the first time since Hitler's Germany that there is a party which discredits and existentially threatens an entire religious community," he told public broadcaster NDR.
The opposition Greens' senior lawmaker Konstantin von Notz accused the AfD of trying to "deliberately turn Islam into a bogeyman to capture voters".
She had also said her party would call for a ban on Islamic symbols such as minarets on mosques, muezzins' calls to prayer and full-face veils, speaking to newspaper Frankfurter Allgemeine Sonntagszeitung.
The anti-immigrant AfD made strong gains in three regional elections last month, profiting from public fears over an influx of more than one million migrants and refugees who arrived last year.