Sky Sports have acquired the rights for the Republic of Ireland's home internationals over the next four years.
The deal means that Irish soccer fans will only see the home games on a paid subscription basis.
The new arrangement comes into effect for the upcoming European Championship qualifiers in September.
John Delaney of the FAI said the primary aim is to develop the sport and to put resources into the domestic game and grassroots football.
The Honorary Treasurer of the FAI said that RTÉ offered the FAI less money this time than in the previous deal. He said the deal is worth €7.5m over four years.
RTE's Director of Television, Cathal Goan, said the station felt a sense of betrayal at the FAI's decision to embark on this deal with a pay-per-view station, particularly so quickly after the recent successful coverage of the World Cup.
The Minister for Arts, Sport and Tourism has expressed his surprise and disappointment at the arrangement entered into by the FAI.
John O'Donoghue said it would inevitably deprive many fans of the opportunity of watching their national team.
He said he had no doubt that his sentiments would be shared by fans of "this great Irish team throughout the length and breadth of the country".
The Fine Gael Spokesperson on Broadcasting said one of the clear purposes of the Heritage Act was to protect events of national interest
Simon Coveney said the fact that the Government has allowed a loophole whereby a pay-to-view channel can buy the rights to home internationals is a failure that has let down the ordinary Irish fan.
"The decision is a blatant commercial decision by the FAI and a selfish one which will result in a lot of people having to pay for the enjoyment of seeing the Irish team play at home," he said.
The Labour Party has described the FAI's decision as "an act of utter betrayal of ordinary Irish fans".
Communications spokesman Eamon Gilmore claimed that the Government must bear a major part of the blame for its failure to bring into operation legislation to ensure that ordinary viewers retained access to major sporting events.
Alan Hunter of the Irish Football Supporters Association described it as "the saddest day for Irish soccer". He said that fans are "livid" about the FAI's decision.