"If it comes down to that moment, Trump or her ... I'd vote for her," said Diller, a major Democratic donor and vehement critic of the president, who labeled Trump an "evil miracle" and called his presidency a "joke."
Taking Warren at her word, "God forbid, it would be bad," said Diller, who led Paramount Pictures, Fox and QVC before founding IAC — a collection of web properties, which include online dating giants Match and Tinder.
Diller, who voiced his concerns about Warren's anti-wealth rhetoric during Wednesday's "Squawk Box" interview, seemed to hold out hope that she would soften her stance if she were to win the Democratic presidential nomination.
Warren "might be moving, at some point once she gets into it, more center," he added.
Generally, candidates, if they're going to move toward the center, wait until they lock down their party's nomination and do it in the general election campaign, in an attempt to appeal to voters beyond their hardcore supporters.
Warren, a liberal Massachusetts senator who has been rising in Democratic presidential polls, has made cracking down on banks and taxing the wealthy central to her campaign — striking fear on Wall Street and in corporate America.
However, compared with Trump over the past three years, Warren would be the better bet, said Diller, who earlier this year said he liked fellow billionaire businessman Mike Bloomberg for president. The former New York City mayor, who has said publicly he's not running, may be reconsidering, according to CNBC sources earlier this month.
"It's one thing for this 'accident' to have happened," Diller said of Trump's 2016 victory, adding that he's worried about reelecting Trump "knowing what we know" about his time in office. "I'm talking about standards, character, decency, all of those values have been blown."
The White House and the Warren campaign were not immediately available to respond to a CNBC request for comment on Diller's remarks.