When our Lord says, “judge not,” in Matthew 7:1, He is using the term only in its negative sense—as the Pharisees judged. Certainly, we are to have discerning judgment, as to who is a false prophet and who is a true one, and to judge doctrine. And the state has judges and magistrates that are appointed by God to judge. And the church also is to judge its people in certain matters of discipline.

The kind of judgement our Lord is speaking of when He says “judge not” is a condemning judgement—a judgment we see in the Pharisees. This negative, condemning judgment can be seen in six ways.

1. It has an evil spirit attached to it. I would say that, for this reason, it is of the devil and it works to destroy us.
2. It condemns and despises others for no good reason. We have seen this toward the Samaritans, and also toward the Jews. Certainly, we see it toward Jesus and toward Christians. Recently we see it from some toward Donald Trump; and we also see it toward entire races of people—toward blacks and toward whites.
3. It has a spirit of self-righteousness and supremacy. This spirit of judgment is based on the lie that one person or persons is better or more righteous than another. It is what condemned an entire race of people (the Jews) to extermination.
4. It hopes for the worst in others. Hence, we see its evil, diabolical nature; a nature that is the opposite of love.
5. It focuses on personalities instead of principles. In correct judgment we always judge according to biblical principles, but in wrong judgment it is always according to something we just don’t like about a person—according to our personal preferences.
6. It is expressing an opinion about someone without gathering knowledge of all the facts. It is a snap judgment. It is a first impression that is often wrong.

Source: Studies in the Sermon on the Mount, by D. Martyn Lloyd-Jones