Italian football will lose €2.6 million in funding after the national team failed to reach a World Cup finals for the first time in 60 years.
All Olympic sports receive funding from the Italian Olympic Committee (CONI) with the funds based on criteria including results and success.
Italy's defeat to Sweden in a qualification playoff means the country's football association (FIGC) will be given a smaller slice of the cake, with other sports earning greater shares.
"We've got to look at Olympic qualification, women's football and rankings," Giovanni Malago, the president of CONI, told Sky Sport Italia.
"We're going to have to discuss with the future FIGC president how we can obtain better results.
"Certain parameters and criteria are involved in the distribution [of funds] and football is going to take a reduction of €2.6 million, which will impact on about seven to eight percent of our overall contributions."
Malago added that the cutback "really should have been far superior," saying it was "a very minor reduction" that had been agreed across the board.
The wider Italian economy is also set to suffer from Italy's World Cup absence, which means the tournament is no longer expected to provide a spending boost in many sectors.
The FIGC is preparing for elections, with president Carlo Tavecchio having resigned days after sacking coach Gian Piero Ventura.