Blatter, on a four-day visit to meet political leaders and inspect stadium construction, said South Africa needed to produce a side that could hold its own against established footballing nations.
"South Africa won the African Nations Cup when they were newcomers in 1996 but barring a miracle, which do not happen often in football, they will not qualify for the 2010 tournament.
"I can’t understand why this has happened," he told a media briefing after a visit to the new Green Point stadium in Cape Town.
"Tomorrow I will speak openly to the leaders of South African football in plain language and tell them they are running out of time. It is the last moment now.
"They need to do something, they need to move it," he added.
South Africa’s 1-0 home defeat by Nigeria earlier this month has left them all but out of contention to qualify for the 2010 Nations Cup finals in Angola. The team were also beaten 1-0 by Guinea in a home friendly last Tuesday.
South Africa, who have employed 15 different coaches for the national side in 16 years since readmission to the FIFA ranks, have steadily slid down the rankings, from a high of 16 soon after their Nations Cup success to their current 70.
This year, Bafana Bafana have won just one competitive international out of eight, a home triumph over lowly Equatorial Guinea.