Pearce is assistant to England coach Capello
England Under-21 boss Stuart Pearce would be the right man to lead Great Britain's team at the 2012 Olympics, says the Football Association.
The England Under-21s are likely to form the basis of the British Olympic side in the run-up to the London Games.
With the FA given the task of running Team GB, general secretary Alex Horne said he wanted Pearce in place by June.
Other home nations do not want to be involved as they are fearful of threats to their individual status within Fifa.
But Horne was hopeful that the governing bodies of Scotland, Wales and Northern Ireland will soften their stance on the squad being made up exclusively of English players.
The British Olympic Association (BOA) has given the FA responsibility to manage the GB team, which could mean they play in some of the fixture slots assigned to the England Under-21s in the build-up to the Games.
But the BOA is unhappy at the prospect of the team not being representative of the United Kingdom.
Wales and Tottenham star Gareth Bale has already said he would like to compete at the 2012 Olympics, putting him on a potential collision course with the Football Association of Wales who have previously said they do not want Welsh players in the GB team.
Horne said: "The current arrangement is that it would be an English team representing the British Isles.
"The BOA have said that it is not acceptable as it stands because it is prejudicial, so we are working through an alternative selection process.
"My agenda for the next three months or so includes serious conversations with the other home nations about the Olympic team because we need to get that right.
"We are all aware there are individual player issues. There are home nation sensitivities. So we need to work that through with the other home nations."
Further discussions could also surround the Olympic team being restricted to only three players over the age of 23.
Former Nottingham Forest full-back Pearce, 48, made 78 appearances for England and has coached the under-21 side since 2007.
And while Horne said that Pearce's "primary focus" is to prepare the under-21 side for the European Championship finals in Denmark in June, he said he would be the "logical" choice to lead the GB Olympic team.
Meanwhile, the FA also revealed they hope to appoint a young English coach to work alongside England boss Fabio Capello by the end of February.
The plan is for the coach to be groomed as a potential national team manager of the future, with former England captain Alan Shearer linked to the role.
Horne stated: "I've got a preferred candidate but I'm not going to give you a name. I envisage it will be a part-time contractual arrangement.
"What I'm working on with [director of football development] Sir Trevor Brooking is the job description to make sure we understand it, so that it's right."
Pearce and goalkeeping coach Ray Clemence are already part of Capello's backroom team.
Horne added: "It's an environment where a young coach can come in and learn from Fabio but also learn from the experiences of Stuart, [England Under-17 manager] John Peacock and the other national coaches that we've got.
"I'm speccing out a role, which is one of the reasons why it's been delayed."