"Investment will be targeted where it has the greatest chance of succeeding using our 'no compromise' philosophy, which sets out to reinforce the best, support those developing and challenge the under-performing," UK Sport chief executive Liz Nicholl, said in a statement.
"UK Sport aims to support all sports and athletes deemed to have medal potential in Rio 2016 or 2020 regardless of whether they are individual or team disciplines."
UK Sport, the body which distributes government funds and National Lottery money to the various sports governing bodies, will announce who gets what next week but minority team sports such as handball and volleyball are preparing for bad news.
Olympic and Paralympic sports were given 313.4 million pounds ($503.78 million) by UK Sport in the period 2009-13, helping the country to take third place in the medals table at London 2012, behind the United States and China.
Britain won 29 gold medals, with the majority in cycling (eight), rowing (four), athletics (four), equestrian (three) and boxing (three).
The appearance of British teams in sports such as handball, volleyball, water polo and basketball was largely symbolic as Britain entered Olympic teams in every event for the first time.
However, with little realistic chance of medals in those sports in four years, UK Sport is set to reduce their funding under its no-nonsense 'no compromise' policy.
Heavily-funded British cycling has become the envy of the world with success building on success.
It received 26 million pounds in the funding package for 2009-13. Rowing enjoyed 27 million pounds while swimming, which fell below expectations at London 2012, had a 25-million-pound budget.
By contrast, volleyball had to make do with 2.7 million pounds and table tennis 1.2 million.
The targeting of money to the elite sports has led to fears that the sporting benefit of London 2012 will not filter down to low-profile team sports in Britain.
"If we say we are not going to fund you unless you perform in a sport with a track history of medals then the legacy of our home Games is actually a reduction of opportunity not an increase," British Volleyball president Richard Callicott said in the Sunday Times.
"That's not what I thought London 2012 was supposed to represent."
($1 = 0.6221 British pounds)
(Editing by Clare Fallon)