Johnston's damming comments come in the wake of Wayne Bridge's decision to turn his back on his international career, following the revelations over Terry's affair with his former partner.
The Manchester City defender issued a statement on Thursday, declaring that his position in the England squad is 'untenable and potentially divisive' and he has decided to make himself unavailable for selection.
Going their separate ways: Bridge has made himself unavailable for England
Bridge's decision to turn his back on England, rules him out of this summer's World Cup, and at 29, probably his last chance to represent his country in football's biggest competition.
But Johnston, who won five league titles with Liverpool in the eighties, believes Terry should walk away from England, paving the way for Bridge to play for Fabio Capello's side this summer.
Kop legend: midfielder Craig Johnston
'My immediate reaction as a 50-year-old former footballer is that you look back on your life's crowning achievements and what you could have done and the pain this man must be going through, to make a decision not to go to the World Cup and play for England, because he can't bear the sight of this guy [John Terry],' Johnston told talkSPORT.
'This guy must be killing himself inside. Not only that, but howunselfish is he? Divisive was the word he used. Of course it'sdivisive. If John Terry were a man of course he would stand up and say'I won't go.' He's the one that's caused all the problems.'
'Whyshould Wayne Bridge have to suffer not only the humiliation of what'shappened, but also the fact that this is his big moment? I think ifJohn Terry did that that would show some team spirit.
'Infootball they can all kick a ball. They can all run like professionalathletes. Football is all about team spirit. At that 99% top- level,you're looking for people that will pull their heart out for eachother. You can't have someone in the dressing room that's sleepingwith his best mates wife.
Sticking the boot in: Craig Johnston has accused John Terry of being selfish
'It goes back to the Bible days; thou shalt not covet thy neighbours' wife. You can't do that stuff and pretend to be captain of England, a good guy, when you're a sneaky bugger sneaking around doing that stuff. John Terry's got a lot of soul searching to do.'
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