Professional Footballers Australia (PFA) said the game was confronting a battle for its soul as commercial interests seek more influence over its pinnacle competitions.
"The PFA is disturbed by the lack of transparency surrounding the proposal and the absence of meaningful consultation with those that generate the value that FIFA is seeking to exploit - the players and the fans," the union said in a scathing statement.
"At a time when football desperately requires greater transparency, accountability and good governance, proposals of this significance raise questions about who the game is run by and in whose interests.
"These tournaments should not be for sale."
The PFA's comments echo the criticism of FIFPRO, the global players union, which warned this week the proposal would irreversibly reshape the incentives underpinning the competitions in which players work and build careers.
FIFA's plan to create a US$20 billion subsidiary to run the World Cup and its other events includes offering minority stakes to private investors to raise up to US$4.2 billion and the promise of a significant funding boost for member associations.
Most of the sport's regional confederations and a slew of national associations said they were blindsided by it, though only Europe's governing body UEFA has rejected it outright.
FIFA President Gianni Infantino said in a video on Wednesday its proposal was not an obligation and had only kicked off a consultation process.
Infantino offered member associations US$40 million each if they agreed to the proposal by September 19 as part of a US$10 billion package to become available from January 1, 2027.
If rejected, the package would revert to US$2.7 billion previously offered - around US$10 million per member association.
The PFA took issue with the timeline.
"We are equally concerned about the pressure being placed on Member Associations, including Football Australia, to expeditiously consider this proposal when it will have profound and irreversible consequences for the ownership and governance of football's premier competitions," it said.
Australia's football association declined to state a position on the proposal, saying it had sought more detail from FIFA to properly assess the strategic, commercial and governance implications.
FIFA plans to put the decision to a vote of its 211 consultation members and then to its executive Council.
Despite UEFA's stance, the powerful bloc of 55 member associations is not united in opposition, with the Czech FA's president saying he could see a "positive impact" from FIFA's intentions.
The African confederation's executive committee will meet next week to evaluate the proposal, while South American governing body CONMEBOL and the Oceania confederation, the smallest regional bloc with 11 full member nations, have not commented publicly.