Liz Truss made the comment ahead of launching an update to the integrated review of defence and foreign policy to counteract the threat of authoritarian regimes such as Russia and China.
Ms Truss was also doubling down on her campaign trail commitment to increase defence spending to 3% of UK GDP by the end of the decade.
She was using her first foreign trip as Prime Minister to rally United Nations allies in New York to keep up the pressure on Russia.
Asked by reporters travelling with her if there was a way for Mr Putin to rejoin the international community, she said: “First Russia needs to leave Ukraine.
“And we need to make sure that there is proper recompense for what has happened in Ukraine and we need to make sure Russia is never again able to threaten countries on its border.”
She later elaborated in an interview with Channel 5 News that she believes Moscow should be “contributing to rebuilding” Ukraine, pointing out Russia’s “vast oil and gas reserves”.
It was unclear whether she meant Russia should leave all of Ukraine’s internationally recognised land, or whether she was exempting Crimea, which Mr Putin annexed in 2014.
Meanwhile, Ms Truss instructed special adviser Professor John Bew to lead an update into the integrated defence review published in March last year.
To be published by the end of the year, Downing Street said it would ensure the UK can “stand firm against coercion from authoritarian powers like Russia and China”.
She will use a speech to the United Nation’s General Assembly on Wednesday to pledge to define a “new era” of “hope and progress”.
“This is a decisive moment in British history, in the history of this organisation, and in the history of freedom,” she is expected to say.
“The story of 2022 could have been that of an authoritarian state rolling its tanks over the border of a peaceful neighbour and subjugating its people.
“Instead, it is the story of freedom fighting back. But this must not be a one-off. Britain’s commitment to this is total.
“Together with our friends and allies around the world, we will continue to champion freedom, sovereignty and democracy.”
But she will also bring up her domestic tax plans, saying: “We want people to keep more of the money they earn, because we believe that freedom trumps instruction.”
During the trip, Ms Truss will pledge that the UK will next year match or exceed the £2.3 billion in military aid to Ukraine given in 2022.
No 10 said she would reiterate the Nato spending commitment for 2030, which the Royal United Services Institute think tank said would cost an extra £157 billion.