Owen Smith has questioned Labour leader Jeremy Corbyn's patriotism, suggesting it is not "part of his make-up".
The leadership challenger said Mr Corbyn's "metropolitan" politics were at odds with Labour traditions about national identity in England, Scotland and Wales.
The former shadow cabinet minister suggested he would be prepared to offer his rival a job in his own shadow cabinet if he won the contest, having previously suggested Mr Corbyn could become Labour's president or chairman - an idea the incumbent leader rejected.
Mr Smith said: "I think Jeremy could absolutely do a job in the shadow cabinet for me, I would welcome him."
Mr Corbyn's patriotism has been questioned before - including after he refused to sing the national anthem at a Battle of Britain memorial service in St Paul's Cathedral.
Mr Smith, who said he would meet the Nato target of spending 2% of GDP on defence, renew Trident and be prepared to push the button to launch a nuclear strike if he was in Number 10, said: "One of the weaknesses we have had recently is that people worry that Labour isn't serious about security, that it is a lesser issue for Jeremy.
"I'm not sure that's right, but he has certainly got a different perspective on some of those things - on patriotism if you like; and on security, on defence I think I have got a more traditional Labour perspective on that - an old-fashioned Labour perspective, if you like."
He added: "I think Jeremy, to be honest, doesn't really understand sometimes the way in which people have a very strong, perhaps socially conservative ... sense of place, sense of where they are from.
"I am not sure I've heard him talking much about Scotland and identity or about Wales and identity or indeed about England and identity.
"I suspect that Jeremy has got a rather more metropolitan sense of that and that's not one I think is central to the Labour tradition."
Asked if he was calling Mr Corbyn unpatriotic, Mr Smith told BBC2's Newsnight: "I am saying that I think it is something that is not core to his set of beliefs. He has got a set of liberal perspectives and left perspectives on things and nationhood and nationalism and patriotism aren't really part of his make-up."
Mr Smith, who has faced criticism from Mr Corbyn and his allies over his previous work for pharmaceutical giant Pfizer, insisted he was committed to a "100% publicly owned" NHS - which would mean rolling back the involvement of the private sector in areas such as commissioning.
"It allows profit and cost to become the principal driver of services, not clinical decisions or need," he warned.
"Introducing the profit motive into the NHS - as into other areas of public service - both dilutes the sense of public connection to it and undermines the essence of what Labour is all about."
He said Labour had to be "much bolder about what the role of the state is."
On immigration, one of the key issues driving voters in former Labour heartlands towards Ukip, Mr Smith acknowledged there were problems in some areas.
"In some places, the way in which we saw rapid influx of - in particular - eastern European migrants after accession of those countries to Europe definitely caused downward pressure on wages, definitely caused changes to local terms and conditions for some workers in some sectors."
He said there were ways to mitigate those impacts, through extra resources for public services, but the Tory attempt to put a target on net migration was a "bone-headed" approach to policy-making.
Mr Smith also insisted that talks on Brexit should not be a binary decision between keeping free movement and remaining in the single market or putting in border controls and leaving the trading bloc.
"That is a false choice," he said, and insisted Labour should be represented at talks with European Union states about the UK's future links to Brussels.
The challenger, who faces a stiff task to overturn Mr Corbyn's support among the party's grassroots activists, warned Labour could be "destroyed" if it did not change course.
"We have been the greatest force for social good for 116 years in this country and it would be a tragedy if we were wiped out," he warned.
"And parties can be wiped out - it takes a long time for parties to rise but they can be snuffed out just like that."
Mr Corbyn's leadership received a boost as Sarah Champion - one of the senior MPs who quit their front-bench roles as confidence in his leadership disappeared at Westminster - returned to her shadow ministerial role.
The Rotherham MP had said Mr Corbyn's position was "untenable" and the party could be "doomed" as she quit in June.
But she has now returned to her post as a shadow home office minister, focusing on women, equality and domestic violence issues, and Mr Corbyn's office urged other rebels to follow her back to the front benches.
Mr Smith dismissed Ms Champion's move, saying: "The job of the leader of the Labour Party is to lead a united opposition at Westminster or to lead a government at Westminster. He couldn't do that.
"Most of those MPs have nominated me overwhelmingly to challenge Jeremy and Sarah deciding to go back in is a pretty minor part of this story."
Mr Corbyn is fighting a legal battle over his place in the contest, after he was automatically named on the ballot paper without having to secure nominations from the party's MPs.
Labour donor Michael Foster, a former parliamentary candidate, is bringing the claim at London's High Court against the party's general secretary Iain McNicol, who is being sued in a representative capacity, and Mr Corbyn.