Blatter is keen to see a British team enter in 2012
Fifa president Sepp Blatter says he would have no problems if Team GB were to field a football team in 2012 consisting of 11 English players.
The Scottish Football Association is against the idea of a unified GB team for fear of losing its unified status.
But the head of the world governing body said: "It is a unique problem. They have four individual associations and one Olympic association.
"For us it's not important if the players are all from England."
Britain cannot qualify for the Olympics as it is based on Fifa's Under-21 competitions in which the four home nations compete individually.
Fifa is willing to allow the home nations to come together as a one-off for 2012, but Blatter suggested any permanent desire to compete at the Olympics could see them lose their independence.
"The 2012 Games will be played in London," he added. "There is another problem there because the four British associations have to put in one team which would be called Great Britain.
In 2012 there'll be a British team
"The first Olympic Games after the second World War were organised in London. There was a British football team there. Therefore, in 2012 there'll be a British team."
Blatter also said Fifa will conduct a review of Olympic football regulations to ensure the London Games in 2012 are not hit by more club-versus-country rows.
Barcelona are one of a number of clubs to have appealed to the Court of Arbitration for Sport (CAS) in a bid to stop their midfielder Lionel Messi from competing for Argentina at the Beijing Olympics.
Fifa insists clubs must release its Under-23 players for international duty based on a regulation passed by the congress in 1988.
It will present its case to CAS on Monday and Blatter expects a final ruling within the next 48 hours.
"It is not only a question of solidarity. It is also a question of respect to the Olympic spirit to let the young players have the experience," he said.
"We need the leagues and the clubs but we need players. Even if the ruling is negative for the players they should stay here, they should play here."
Blatter urged the clubs to "let the players play" - but he admitted an urgent review was required.
He said: "In the future I think it is necessary we have an exact and precise ruling.
"It has been decided for 2012 to avoid any misunderstandings and problems - plus or not plus three overage players - that the whole item of the presence of football in the Olympic Games shall be discussed immediately after the conclusion of the 2008 Olympic Games, together with the IOC.
"The discussion will be open and is (designed) to have a clear and clean situation for everybody for the 2012 Olympics which will be played in London."