The FIFA president is facing renewed calls for his resignation after dismissing on-pitch racism with an astonishing response.
Asked directly by a CNN reporter if racism exists on the pitch, Blatter denied it and said such incidents should simply be settled by a handshake at the end of the match.
Scroll down to watch the Blatter interview.
Hands up: Sepp Blatter is looking increasingly out of touch
A history of clangers from bumbling Blatter In 2004, the FIFA president said women players should 'wear tighter shorts and low cut shirts. to create a more female aesthetic.'
'I would say they (gay fans) should refrain from any sexual activities' - Blatter after being asked about the illegality of homosexuality in Qatar after they won the right to host the 2022 World Cup.
'I think in football there's too much modern slavery in transferring players or buying players here and there, and putting them somewhere.' - Defending the 'oppressed' Cristiano Ronaldo after his ?80m switch from Manchester United to Real Madrid.
In response to whether football had sexual inequality, he replied: 'There are gay footballers, but they don't declare it because it will not be accepted in these macho organisations. Look at women's football - homosexuality is more popular there.'
'We could make two halves four quarters' - In response to how 'soccer' could be more accessible to Americans.
'I have never seen Italy, Germany, Brazil or Argentina with a coach from another country. In fact, most of the best teams have a coach from their own country.' - Blatter's response to Fabio Capello's appointment as England boss.
'I would deny it,' he said. 'There isno racism, there is maybe one of the players towards another, he has a word or a gesture which is not the correct one, but also the one who is affected by that, he should say that this is a game.
'We are in a game, and at the end of the game, we shake hands, and this can happen. On the field of play sometimes you say something that is not very correct, but then at the end of the game you have the next game where you can behave better.'
To a reporter from Al-Jazeera he simply compounded the situation.
'Duringa match you may say something to somebody who is not exactly looking like you,' he said. 'But at the end. it's forgotten.'
It comes as Luis Suarez was charged by the FA over allegations that he racially abused Patrice Evra.
At the same time, England captain John Terry remains the subject of an FA inquiry and a formal Metropolitan Police investigation into claims that he racially abused Anton Ferdinand at Loftus Road last month.
Charged: It is claimed Suarez racially abused Evra last month
Under fire: Suarez has strenuously denied the claims
Now Blatter is facing a fight to hold on to his job after a backlash from the world of football.
After Rio Ferdinand's Twitter rant, UK Sports Minister Hugh Robertson said: 'This is incredibly serious but it is part of a pattern of behaviour.
Asked whether Blatter should go, Robertson said: 'Yes. I can't see there's anything terribly new in this. We've been saying this for some time. Sepp Blatter will expect the English and the English press to pile in on him.'
Professional Footballers' Association chief Gordon Taylor weighed in by saying: 'He is the leader of world football, he has to be a leader in anti-racism.
'Racism is divisive and for him to say the player on the receiving end should forget about it at the end of the game and shake hands.we are going backwards. it is not good enough, it's embarrassing.
'And coming on top of his comments which were offensive about female footballers, his homophobic comments about homosexuals not going to Qatar, the World Cup bidding process, he won't have technology over goalline decisions and the corruption which is so plainly evident at FIFA. It is time for him to go.
Eye of the storm: Sepp Blatter embraces FIFA member Tokyo Sexwale
'He has presided over a lot of issues which haven't been good enough. If he is the leader of world football I am not going to be a follower and I can't believe anyone could follow him.
'It can't be acceptable and I believe it is the straw which broke the camel's back. He should step aside so we can see what Michel Platini can do.'
Blatter is desperately attempting to resolve the issue and has even taken to Twitter to hit back at a furious Rio Ferdinand.
After initially posting: '@SeppBlatter your comments on racism areso condescending its almost laughable. If fans shout racist chants but shake our hands is that ok?', Ferdinand then added - in reference to a picture of Blatter with FIFA member Tokyo Sexwale: 'Fifa clear up the blatter comments with a pic of him posing with a black manI need the hand covering eyes symbol!!'
On Thursday, Blatter replied: '@rioferdy5 The 'black man' as you call him has a name: Tokyo Sexwale. He has done tremendous work against racism and apartheid in Africa.
'We have done several joint activities to raise awareness on the struggle against racism in South Africa. FIFA has a long standing and proud record in the area of anti-discrimination which will continue.'
After Wednesday's interviews, Blatter tried to repair the damage on his official Twitter page, without much success.
Loud and clear: Sepp Blatter speaks to CNN
ASTONISHED RIO'S TWEET FURY
Rio Ferdinand (right), who is awaiting the outcome of allegations of racist comments made against his brother Anton by John Terry, was quick to condemn Sepp Blatter's comments on Twitter.
'Tell me I have just read Sepp Blatter's comments on racism in football wrong. if not then I am astonished.'
'I feel stupid for thinking that football was taking a leading role against racism. it seems it was just on mute for a while.'
'Just for clarity if a player abuses a referee, does a shake of the hand after the game wipe the slate clean??'
After that FIFA released an official statement on their website. Blatter, alongside a picture of him embracing a black man, claimed his comments had been 'misunderstood'.
Hisstatement said: 'The statement said: 'I would like to make it very clear, I am committed to the fight against racism and any type of discrimination in football and in society.
'Ihave been personally leading this battle against racism in football, which FIFA has been fighting against throughout the past years through campaigns in all of our competitions such as the 'Say no to racism' campaign.
'I also know that racism unfortunately continues to exist in football, and I have never denied this. I know that it is a big problem in society, and that it also affects sport.
'I strongly believe that we should continue to fight all together against racism on and off the field of play, in order to eradicate this plague.
'My comments have been misunderstood.What I wanted to express is that, as football players, during a match, you have 'battles' with your opponents, and sometimes things are done which are wrong. But, normally, at the end of the match, you apologise to your opponent if you had a confrontation during the match, you shake hands, and when the game is over, it is over.
'Anyone who has played a football match, or a match in any sport, knows that this is the case.
'Having said that, I want to stress again that I do not want to diminish the dimension of the problem of racism in society and in sport. I am committed to fighting this plague and kicking it out of football.'
Last night, the latest storm to engulf FIFA's president was being digested by Sports Minister Hugh Robertson and the FA.
But there was condemnation from Football Against Racism In Europe, who described Blatter's comments as 'insensitive and not what you want to hear from someone who should be leading the game'.
Investigation: Terry is awaiting his outcome
PFA chief Gordon Taylor condemned Blatter's comments, saying: 'It's very insensitive and inappropriate at this time. As the president of FIFA he's got to be shouting from the topof the hills that it's unacceptable.'
Premier League chief executive Richard Scudamore said racism does still exist in football and that they would continue to strive to eradicate it.He told CNN: 'Racism exists in the world, racism certainly still exists in football, albeit reduced. There are still issues, of course there are and we're not complacent about that, but I think it's a bit of a stretch to say it doesn't exist because it does.'
Strong stance: Premier League chief Richard Scudamore
Asked about the two FA investigations into allegations of on-pitch racism Scudamore added: 'The English game has led and has been at the forefront of reducing incidents of racist behaviour, it's totally unacceptable.
'Everybody in the game in England understands it's totally unacceptable, we have that reputation and as far as I'm aware that reputation is still intact until proven otherwise.
'But of course the game will deal with whatever is thrown against it. There is no place for it in football let alone in England and we will continue to strive to eradicate it.'
Rio Ferdinand, the former England captain and brother of Anton, was one of several footballers to express his considerable dismay on his Twitter page.
This all came on the day the FA finally charged Suarez after a month of investigations relating to the events that allegedly took place at Anfield on October 15.
Manchester United's Evra claimed, after the 1-1 draw between the two great North West rivals, that Suarez called him a 'n****r' at least 10 times, a claim that is believed to have been backed up by some of the Frenchman's team-mates during the exhaustive interviews that followed.
Suarez himself broke cover earlier this month, claiming that the word he used was similar to that used by United players when referring to Evra.
There was also a suggestion that he may have used the word 'negrito', a term that is not considered offensive in his native South America.
A Liverpool club statement said: 'We will discuss the matter fully with him but he will plead not guilty and we expect him to request a personal hearing. Luis remains determined to clear his name.'
Fresh calls for Blatter to resign after claiming players should forget racism with handshakeSuarez charged! FA take action as striker prepares to plead not guilty in Evra race rowRacism? It can all be forgotten in a handshake, says Blatter (the head of world football)