Speaking to Just the News, Trump confirmed that the "final documents are being drawn up" to ban the group in the US.
He added that the policy would be enforced "in the strongest and most powerful terms".
A terror designation would make it illegal for anyone in the US to provide "material support" for the group and allow for the deportation of its representatives if they are not US citizens.
The move follows a similar decision by Texas Governor Greg Abbott targeting both the Brotherhood and the Council on American-Islamic Relations (Cair).
In response, Cair filed a lawsuit against Abbott, claiming that the designation was "unconstitutional and defamatory".
Commenting on the news, Prime Minister Netanyahu said: “I want to praise President Trump for his decision to outlaw and define the Muslim Brotherhood as a terrorist organisation. This is an organisation that endangers stability throughout the Middle East and beyond.”
“Therefore, the State of Israel has already outlawed part of the organisation, and we are working to complete this action soon.”
This prompted a similar row to unfold in Israel, with Netanyahu appearing to suggest in his comments that Ra’am, one of the major Arab-Israeli political parties, could be banned.
The party is the political wing of the Southern Islamic Movement, which until the late ‘90s was unified with the Northern Islamic Movement. The Northern version was banned in 2015 over its alleged links to the Brotherhood.
Ra’am’s leader, Mansour Abbas, has denied the connection and said he is “evaluating the legal situation” in case a move to ban the party is made.