Speaking at Founders Forum in London, the Google executive chairman is reported to have said: "Once computers overtake humans, humans never catch up."
Twitter users reacted swiftly, saying humans should pull the plug.
Just pull the plug... Sorted!!! @brenthoberman@Marthalanefox@ericschmidt
The remark comes after a number of business leaders and scientists have warned that advances in machine learning and artificial intelligence could pose a threat to humanity.
But Google DeepMind cofounder Mustafa Suleyman claims that there's no reason why humans should fear artificial intelligence.
"The idea that we should be spending these moments now talking about consciousness and robot right is really quite preposterous," he said at a machine learning conference held at Bloomberg's UK headquarters in London this month.
Schmidt also said that advances in machine learning would lead to improvements in a wide range of sectors, including health, transportation and energy.
In order to get the best results, humans should combine the strengths they have around judgement with the strengths machines have around data analysis, he said.
One area where computers have becoming increasingly sophisticated is image recognition and Schmidt said, "computers can now see like humans".
He also plugged driverless vehicles, saying: "Let the computer do the driving, they never get drunk."
In terms of innovation, Schmidt said Europe is now outpacing Silicon Valley, pointing to cities such as Stockholm, Tel Aviv and Cambridge, adding that a single European digital market is crucial if Europe is to reach its full potential.
"We need a single European digital market and I am convinced it will happen," he said.
If individual countries want to reach grow their GDPs then government's should focus on linking education, immigration and entrepreneurship, he said, adding they should be complimented by very fast internet.