Blatter held a meeting with the Scottish FA on Saturday
Fifa president Sepp Blatter says a Great Britain football team at the 2012 Olympic Games should feature only English players.
The Scottish, Welsh and Northern Irish football bodies oppose a GB team in case it affects their Fifa status, while England back the idea.
Blatter now says said the independent status of the four British associations could be harmed by a unified GB team.
"They should enter only a team composed of players from England," said Blatter.
"This will then not provoke a long and endless discussion of the four British associations."
The International Olympic Committee does not recognise separate teams from Britain's home countries.
Olympic qualification has been impossible as it is based on Fifa's under-21 competitions in which the four home nations compete individually.
Blatter was speaking from Gleneagles, Scotland, where the International Football Association annual meeting has been taking place.
The Scottish FA reiterated its opposition to a unified team during a meeting with Blatter on Saturday.
"I said that is the best thing for you to do," said Blatter.
"If you start to put together a combined team for the Olympic Games, the question will automatically come up that there are four different associations so how can they play in one team.
"If this is the case then why the hell do they have four associations and four votes and their own vice-presidency?
"This will put into question all the privileges that the British associations have been given by the Congress in 1946."
Great Britain would have a men's team for the first time since the 1956 Olympics and a women's team for the first time ever.