Junee have until next week to field a first grade side or they will be withdrawn from the competition.
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Group Nine chairman Andrew Hinchcliffe confirmed the Diesels must follow NSW Rugby League's policy after forfeiting their first round game to Southcity on Sunday.
It states if any team or club that has forfeited twice in succession or three times in total may face elimination from the respective competition.
"On the back of a couple of years it is appropriate to give them as much time and space as we could and the best opportunity possible to form a team," Hinchcliffe said.
"They are in a pretty unfortunate situation at the moment with possibly some players coming in in the next week.
"They've forfeited this week, which is unfortunate, but we're going to use the current rules within NSW Rugby League which determines two consecutive forfeits or three in a year means that particular grade would be removed from the competition.
"That doesn't give Junee a whole lot of time to pull that team together."
Junee are set to tackle Temora at Nixon Park next Saturday, which will also be the Dragons' first game of the season.
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After Junee were given compensation not to field a first grade side last year, on the condition of returning to the first grade fold, a number of Group Nine clubs have questioned why the Diesels forfeited first grade rather than reserve grade.
Junee president David Holt raised concerns over their duty of care and the Group Nine board agreed it was the right decision considering their current playing numbers.
"We had a look at their team lists and it was pretty clear to us the squad that they currently had available wasn't going to help anyone if that squad played in first grade," Hinchcliffe said.
"With the players they've got coming in that should enable them to play first grade and now they've got a couple more weeks to sort that out hopefully.
"Otherwise they will be without first grade for this year."
At this stage no changes will be made to the draw.
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