"The long-awaited global recovery is taking root," she said in an address Thursday evening at Harvard's Kennedy School of Government.
Countries around the globe are seeing renewed or sustained economic expansion, coinciding with greater stability in banks and market confidence, she said, according to prepared remarks.
"Can the world seize the opportunity of the upswing to secure the recovery and create a more inclusive economy that works for all?" she asked.
Her remarks come the week before the IMF and World Bank are due to begin annual meetings with 189 member nations at which the Fund will unveil updated forecasts for global growth.
The IMF since last year has confronted a tide of populism in the developed world, with forces hostile to trade liberalization on the rise in the United States and Europe.
But Lagarde spotlighted what she said were dangers on the horizon, including slow growth, mounting inequality in advanced economies and failures in adapting to technological change.
"As a result, our social fabric is fraying and many countries are experiencing increased political polarization."
In addition to calling for monetary and fiscal policies that support growth, Lagarde also said countries should invest in infrastructure, research and development to boost productivity and demand, which could reduce unemployment and under-employment.
Expanding access to health care and education as well as adopting progressive taxation could help reduce inequality, she added.
"IMF research has shown that excessive inequality hinders growth and hollows out a country's economic foundation," she said. "It erodes trust within society and fuels political tensions."
Lagarde also called climate change "a threat to every economy and every citizen," saying that a one-degree increase in average annual temperature in country like Bangladesh would cut per capita GDP by almost 1.5 percent.
"Policymakers should use all tools at their disposal to act now," she said.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
Get Breaking news, live coverage, and Latest News from India and around the world on NDTV.com. Catch all the Live TV action on NDTV 24x7 and NDTV India. Like us on Facebook or follow us on Twitter and Instagram for latest news and live news updates.