"None of the money earmarked for health and education has been diverted to the building of World Cup stadiums," Brazil's sports minister Aldo Rebelo told reporters.
FIFA Secretary General Jerome Valcke added: "FIFA is not making four billion reais ($1.77 billion) to run away in a big Mercedes Benz.
"We are using our money to develop football and we are one of the most transparent sporting organisations in the world."
A wave of nationwide protests have alarmed organisers of the Confederations Cup, a dry run for next year's event which is currently taking place in Brazil and features world champions Spain, Uruguay, Italy and Mexico among the eight teams.
Former Brazil forward Romario, now a Congressman, has been among the most vocal, high profile critics, complaining that FIFA set up a "state within a state" and is the "real president" of the country.
Rebelo said the government's budget for health and education this year was 177 billion reais.
"The sports ministry's budget is one percent of that and includes money spent on the World Cup," he said, adding that 24,500 direct jobs been created in Brazil at the six Confederations Cup stadiums including construction, engineering, telecommunications."
"The World Cup and Confederations Cup represent an historic opportunity to promote the development of the country," he said. "It has brought forward investments which would have to have been made regardless of the World Cup and the Confederations Cup.
"People think we come in, we enjoy the country and run away, without paying tax or creating anything," said Valcke.
"I'm not ashamed of what we're going, we're doing good things for Brazil," he said.
Valcke said that FIFA was a "non-profit" organisation which ploughed money back into the development of football worldwide."
"We have 20 competitions in a four-year cycle and the World Cup is the only one of them which make money," he said. "We have duties, responsibilities, programmes w
