Terry announced he was making himself unavailable for his country on Sunday night with immediate effect, on what was the eve of his FA racism hearing.
The Chelsea captain effectively accused the FA of forcing his hand after they charged him over last October's altercation with QPR defender Anton Ferdinand, despite the decision of Westminster Magistrates Court to clear him of a racially-aggravated public order offence over the same incident.
But FA general secretary Alex Horne hit back this morning, telling Sky Sports News outside Wembley: "I don't see how we've made it untenable - they're two very separate processes.
"It's something that happened in a match between QPR and Chelsea - it shouldn't be taking a year to resolve but we feel we're reaching a conclusion on that.
"That's a very different process, from my perspective, from our England procedures.
"They sit in different compartments and I could separate the two in my mind.
"But, unfortunately it doesn't look like he could."
Horne was speaking as Terry's hearing in front of an independent FA panel looked to have got under way, with some of the key players reportedly arriving at Wembley.
Ferdinand appeared to be photographed being driven through the national stadium's east entrance, while there were unconfirmed rumours Terry had earlier arrived at the west entrance.
Terry's trial lawyer, George Carter-Stephenson QC, entered the building early this morning.
Terry could face a lengthy ban if found guilty by the FA of using racist language during Chelsea's Barclays Premier League defeat at QPR on October 23 last year, a charge he categorically denies.
The 31-year-old was found not guilty in court in July, with the prosecution unable to prove he had called Ferdinand a "f****** black c***" as an insult.
Terry admitted using the words, but insisted he had only been repeating words he thought Ferdinand had accused him of saying.
Chelsea and England team-mate Ashley Cole gave evidence that helped exonerate Terry, telling the court: "We shouldn't be sitting here."
Also, journalists understand Cole had no plans on Sunday to make a dramatic show of solidarity and follow Terry into international retirement.
Terry's legal team could attempt to get the FA case against him dismissed on Monday by arguing the governing body's own rules dictate his acquittal in court means the case cannot proceed.
The FA may counter their charge against Terry is distinct enough from the offence from which he was cleared in July.
The panel who handed Liverpool striker Luis Suarez an eight-match ban when they found him guilty of racially abusing Manchester United defender Patrice Evra last season declared at that time that simply using racist language was enough to constitute a breach of FA rules.
Journalists understand Terry spoke to England manager Roy Hodgson before releasing Sunday night's statement.
Hodgson controversially picked Terry for this summer's European Championship, while his court case was still pending.
Horne added of Terry's decision on Monday: "It's obviously disappointing. He played well for us at the Euros, but it's his decision and we respect that."
Club England managing director Adrian Bevington said the 78-cap Terry had "always given his all" and had been a "great servant" for his country.
Terry said in his statement on Sunday night: "Representing and captaining my country is what I dreamed of as a boy and it has been a truly great honour.
"I have always given my all and it breaks my heart to make this decision.
"I want to wish Roy and the team every success for the future.
"I am making this statement today in advance of the hearing of the FA disciplinary charge because I feel the FA, in pursuing charges against me where I have already been cleared in a court of law, have made my position with the national team untenable."