In remarks that stunned party leaders, Advani said on his blog that while people were angry with the Congress-led government, they were upset with the Bharatiya Janata Party too.
The biting comment came just days after the BJP's national executive meet in Mumbai, where Advani conspicuously stayed away from a post-meeting rally after Gadkari was given an extension as president.
BJP spokesman Pakash Javadkar declined to take questions on Advani's blog post. Other party colleagues either refused to comment or claimed they were unaware of Advani's comments.
Later in the evening, BJP leaders met at Gadkari's residence apparently to discuss Thursday's Bharat Bandh against the fuel price hike. Advani did not attend.
Advani, in his blog post, said: "The mood within the party these days is not upbeat. The results in Uttar Pradesh, the manner in which the party welcomed BSP ministers who were removed by Mayawati on charges of corruption, the party's handling of Jharkhand and Karnataka - all these have undermined the party's campaign against corruption."
He was referring to three events in which Gadkari is believed to have played a key role.
The first was on letting BSP's tainted Baburam Kushwaha of Uttar Pradesh into the BJP, causing anger in BJP ranks.
In Jharkhand, Gadkari backed businessman Anshuman Mishra's candidature for a Rajya Sabha seat before protests within forced Mishra to back off.
In Karnataka, Gadkari is said to be supporting former chief minister B.S. Yeddyurappa, whose equations with Advani are poor.
Reiterating that the BJP needs to introspect, Advani said journalists voiced "public opinion correctly" when they said the BJP-led alliance was not rising to the national situation.
"I, as a former pressman, feel they are reflecting public opinion correctly."
"I had said at the core group meeting that if people are today angry with the UPA government, they are also disappointed with us," Advani said. "The situation, I said, calls for introspection."
The comments come soon after he kept away from a public rally after the BJP national executive meet in Mumbai.
According to party sources, Advani is upset that Gadkari takes decisions unilaterally.
The BJP had then refuted speculation that Advani was unhappy that Gadkari had got another term as president and that he had not been portrayed as the prime ministerial candidate.
BJP Prakash Javadekar declined to react to Advani's blog. Even as he spoke about "bad governance" by the UPA, he made a quick exit when he was asked about rifts in the BJP leadership.
Fishing in troubled waters, Congress leader Digvijay Singh meanwhile hit out at Gadkari, saying he was more of a businessman.
"Gadkari has never won an election, he is more of a businessman than politician. This is reflected in his dealing of all matters."
Advani added that the BJP rule in many states and the "excellent" leadership provided in parliament by Sushma Swaraj as well as Arun Jaitley "is no compensation for the lapses committed".
One of the founders of BJP's predecessor Bharatiya Jana Sangh and among India's better known parliamentarians, Advani led the party from strength to strength in the 1980s and 90s.
But it was his long-time companion Atal Bihari Vajpayee who became prime minister when the BJP took power in 1996 briefly and again from 1998 until 2004.
Advani was then the home minister and later deputy prime minister. The BJP portrayed him as prime ministerial candidate vis-a-vis Manmohan Singh in 2009 but lost the Lok Sabha battle.