The London 2012 legacy is struggling to "inspire a generation", after it emerged the number of 16 to 25-year-olds playing sport has gone down since the Olympics, with football less popular than swimming and cycling.
Football's participation numbers are down to 1.83 million, a drop of 100,000 since April, and more than four per cent down on the 2005 figure.
Sport England chief executive said: "We are very disappointed by football's results and the FA really need to grasp this.
A Team GB men's football team competed at the London 2012 Olympics
"There is now to be a discussion with the FA and our board, but we operate a payment for results scheme so football are definitely in the at-risk zone.
FA general secretary Alex Horne said reversing the drop was a "top priority".
Horne said: "These are clearly disappointing numbers. Understanding and reversing the fall in participation is an immediate and top priority and we are working exhaustively with Sport England and our other partners to ensure the right plans and programmes are in place to achieve this.
"Notwithstanding the impact of external factors such as the weather and the economic pressures on local authority playing facilities; what is clear is that the nature of football participation is changing and that our players increasingly want football on their terms; less formal, less frequent, more flexible."
Team GB - Olympic Medals
Overall, however, there has been an increase since April in the number of people playing sport once a week, bouncing back after a slump earlier this year caused in part by the coldest March for 50 years. The total number of people in England participating in sport each week stands at 15.5 million, up 206,000 from April.
Andy Murray's success at Wimbledon - both at last year's Games and the 2013 Championships - has also failed to boost tennis, which earlier this year had a £530,000 funding cut imposed. The sport could lose more of its £17.4 million four-year award after participation fell from 423,400 in April to 406,000.
Nick Humby, the chief operating officer of the Lawn Tennis Association, said he welcomed Sport England's belief that the sport was now focused on boosting participation.
Humby told Press Association Sport: "We are of course hugely disappointed that the October 2012/13 numbers have gone down but we take encouragement from the peak between July and September exceeding that of the Olympic and Paralympics last year."
The LTA will also have a new chief executive, Mike Downey who is coming from Canadian tennis, starting in January.
Swimming has halted its downturn with a 50,000 increase on April's figures to 2.93 million, while athletics/running is up 63,000 to 2.01 million.
Rugby league has also seen a rise in numbers - Sport England believe due to switching to become a summer sport.