The International Olympic Committee on Saturday threatened to suspend India's membership if the national federation did not conduct elections as per the Olympic charter.
The faction-ridden Indian Olympic Association (IOA) is due to hold elections on December 5 to replace tainted ex-president Suresh Kalmadi, who was jailed for corruption during the 2010 Commonwealth Games in New Delhi.
The IOA has been directed by a Delhi court to hold elections as per the government's sports code, while the IOC wants the federation to abide by the Olympic charter that favours autonomy.
An IOC statement posted on its website said it had written a letter to the Indian federation informing it that a proposal to suspend the IOA will be presented to the IOC's Executive Board on December 4 and 5 if the "current situation was not rectified".
"For more than two years, the IOC has expressed severe concerns about government interference in the IOA's upcoming election process," the statement said.
"There is also concern over information only recently provided by the IOA that its elections would be conducted based on government regulations rather than the IOA's constitution and the Olympic charter.
"Should this be the case, and as previously warned, the results of such elections would not be recognised by the IOC.
"The IOC's position has been expressed to all parties concerned on numerous occasions. However, the IOA has been unable to resolve these pending issues satisfactorily.
"The IOA has also failed to keep the IOC informed in a timely manner or ensure close co-ordination. For these reasons, the IOA is now at risk of suspension by the IOC -- a matter that will be discussed at the next IOC Executive Board meeting."
The letter to the IOA was co-signed by IOC president Jacques Rogge and the head of the Olympic Council of Asia, Sheikh Ahmad Al Fahad Al Sabah of Kuwait.
The IOA is currently headed by veteran sports administrator Vijay Kumar Malhotra on an interim basis after Kalmadi, who served as president for 16 years, decided not to seek re-election.
Kalmadi is currently out on bail after spending nine months in jail for graft charges related to the Commonwealth Games.
But his protege, Abhey Singh Chautala, is contesting for the post of president against Randhir Singh, a long-time IOC member and currently secretary-general of both the Indian and Asian Olympic bodies.
Malhotra told reporters he would write to Prime Minister Manmohan Singh asking him to withdraw the government's sports code to avoid India being suspended from the Olympic movement.
Suspension from IOC membership would mean India would not receive IOC funding and its officials would be banned from attending Olympic meetings and events.
India's athletes would also be barred from competing in the Olympics under the national flag, although the IOC could allow some to participate under the Olympic flag.