FIFA vice-president Jim Boyce believes diving is becoming a "cancer" and wants culprits to be punished retrospectively in future.
The issue has become a hot topic after Liverpool's Luis Suarez was shown to be trying to con the referee in his side's 0-0 draw with Stoke on Sunday.
The incident led Potters boss Tony Pulis to call for players adjudged to have been guilty of simulation to be banned retrospectively for three matches.
The Football Association does not currently allow punishments to be applied to players guilty of diving after matches but Boyce, Great Britain's FIFA representative, believes this is something that needs to be addressed.
"I have seen several incidents recently, and I watched the latest Suarez incident two or three times, and to me it is nothing less than a form of cheating," he said.
"It is becoming a little bit of a cancer within the game and I believe if it is clear to everyone that it is simulation then that person is trying to cheat and they should be severely punished for that.
"It can be dealt with retrospectively by disciplinary committees, and it is done so in some associations, and I believe that is the correct thing to do.
"It can at times be very, very difficult for referees to judge whether something is a foul or a fair tackle and if players are diving then it makes their job even harder.''
The issue of diving has been discussed by the FA, the Premier League and the Football League before without any change in policy being taken.
The Premier League has previously suggested a three-man panel to review contentious incidents after every weekend, which could include simulation, and it would be open to renewing discussions on bringing in such a system.
The FA said the issue was often reviewed, with a spokesman saying: "Simulation is not something that the FA currently take retrospective action over but it is an issue that is often reviewed and discussed by the game's stakeholders.''