Rangers were wrong to transfer list their Australian captain Craig Moore for wanting to play in this year's Olympic tournament in Athens, FIFA president Sepp Blatter said on Friday.

Rangers put Moore on the transfer list on Thursday after the defender opted to play at next month's Olympics instead of in the Scottish club's Champions League qualifying campaign.

"To participate in the Olympic Games is an honour. It is an honour for the player, but it should also be an honour for the club," Blatter told a news conference in Sydney.

"The experience would benefit both the player and the club."

The 28-year-old will also miss several premier league matches in August to feature as one of three over-age players for his country at the under-23 soccer tournament in Athens.

Australian Soccer Association chief executive John O'Neill told a news conference: "It's a great pity that Rangers chose to penalise him for his commitment to play for Australia."