Mexico have been warned by the International Olympic Committee's (IOC) autonomy tsar Patrick Hickey they could miss Rio 2016 because of Government interference.
Hickey has written to the Mexican Olympic Committee (COM) warning them they face being suspended unless the situation is resolved.
The letter, which is also signed by Pere Miró, head of the IOC National Olympic Committees Relations Department, follows an escalating row in the country over the amount of authority the Government has over the COM.
Last week, Alfredo Castillo, head of Mexico's National Commission of Physical Culture and Sports (CONADE), dismissed the Olympic Charter as an "invention created to avoid monitoring public money" after the Government was accused of interfering in the activities of sporting bodies.
Castillo has claimed that money is not being properly channeled to athletes who require it.
He has said there are too many "rich Federation directors and poor athletes.”
COM President Carlos Padilla had warned the Government that Mexico could be suspended as a result of their interference but the Government accused him of "blackmail".
Hickey and Miró have now made it clear in their letter, however, that the threat is a real one.
"Sports organizations in a country are primarily governed by their respective laws and regulations," wrote Hickey in the letter, which insidethegames has a copy of.
"At the same time, they must be in a position to fulfill its mission and to exercise their responsibilities and specific duties in accordance with the basic principles and rules of the Olympic Movement, if they want to be affiliated or retain their affiliation with international sports organizations, as a result, to participate in international sporting events.
"In this regard, Government authorities and the sports legislation of a country should fully respect the principle of autonomy of the Olympic Movement, and should not micro-manage the internal governance of the National Olympic Committee (NOC) and National Federations (NF). Government authorities must also respect the organization of the Olympic and Sports Movement worldwide, and can not substitute themselves to the jurisdiction and specific powers of sports institutions (in particular the NOCs and NFs nationally).
"At the same time it is clear that sports organizations must fully comply with the basic standards of good governance that apply within the Olympic Movement."
It is due to be discussed at the next meeting of the IOC's ruling Executive Board in Lausanne from December 8 until 10.
Mexico could become the second country banned by the IOC, following Kuwait, who were suspended last October due to political interference.
If Mexico are suspended, however, it would impact on Rio 2016 in a much bigger way than Kuwait, who have won only two Olympic medals in their history.
Among the athletes who could be potentially unable to compete are their men's football team, winners of the Olympic gold medal at London 2012, beating Brazil in the final.
At London 2012 Mexico were represented by 102 athletes in 23 sports.
Besides the gold medal in football, they also won three silver and three bronze.
This included Aída Román, second in the women's individual archery competition.
Castillo was appointed by Mexican President Enrique Peña Nieto, widely seen as a close ally, in April after previously serving as Commissioner of the Ministry of the Interior in the drug-trafficing riddled State of Michoacan.
He has since developed an increasingly adversarial relationship with sporting bodies.
The activities of 10 Federations have been questioned, including those representing archery, athletics, basketball, boxing and weightlifting.
Mexican Federation of Athletics President Antonio Lozano claimed the allegations are untrue.
He insisted the decreased money going to athletes is due to Government funding cuts.
Padilla claimed he was confident a solution could be reached before the IOC Executive Board discuss the matter.
"As President of the Mexican Olympic Committee, this is a very regrettable news; but I think it points to reach a good understanding can be perfectly solved with the Minister of Education and various authorities of the Federal Government before December 8," he told insidethegames.