Sport funding in Scotland is facing a 20% reduction over a three-year period, a move described as "heartbreaking" by the national agency.
sportscotland says it has yet to decide where the cuts will fall amid concerns that elite athletes could suffer.
The cuts are being blamed on reduced government spending and a drop in National Lottery ticket sales - a major contributor to sports backing.
Governing bodies are bracing themselves for potential job losses.
About 60% of funding is made up from Scottish Government money, with lottery sales making up the rest.
In the year ending 2015, total revenue was £65.1m, which is divided up and awarded to 52 sports.
Scotland will be playing 'catch-up'
By the end of next year, that figure will have fallen to £51.8m - a cut to the Scottish sporting budget of 20% in just three years.
sportscotland chairman Mel Young said: "It's heartbreaking to me because I know the effort the sport governing bodies and the community that's around it; the volunteers and the mums and dads.
"And, to have to say that we're having to cut some money back is, I believe, not the right way to go."
Former badminton player Susan Egelstaff, a double bronze medallist at the Commonwealth Games [in 2002 and 2006] and an Olympian, fears the cuts will have "a huge impact".
"What that means in the future is that Scotland will be constantly playing catch-up," she said. "It's almost impossible to catch up if you fall too far behind the leading nations."
The Scottish Government said sport and physical activity play a "key role" in a healthy Scotland and that "significant" investment would continue in those areas.
"Having successfully delivered the Commonwealth Games [in 2014] we are now focusing on protecting or raising investment in areas intended to decrease health inequality and improve life chances, and the small reduction in the sport budget allows us to support those priorities," Minister for Sport Aileen Campbell said.
"There is on-going support for active lifestyles through capital investment in cycling and walking, and over the last 10 years we have invested £168m in sport infrastructure - from grassroots to the elite performance which has increased the facilities and opportunities to get people active and achieve on the world stage at both the Olympics and Commonwealth Games."