Northern Ireland Secretary Theresa Villiers said a republican parade commemorating dead IRA men in a town close to the Border should be called off.
Unionists claimed Sunday's demonstration in Castlederg, Co Tyrone, to commemorate Provisionals killed in the Troubles was a glorification of terrorism.
Two of the dead were blown up by a bomb which they had planned to plant in Castlederg.
Relatives of local victims met Ms Villiers yesterday and urged her to ban the parade.
Although she said she did not have the power to impose a ban, she said afterwards: “Everyone who wants to build a genuinely shared future for Northern Ireland needs to consider the impact of their actions on people from different parts of the community.
“This parade is damaging to community relations and even at this late stage I would call upon the organisers to think again and call it off,” she said.
She held talks with representatives of the Derg Valley Victims’ Voice lobby group, which is organising a protest against the march.
Sinn Fein has argued the route has already been changed to avoid the most contentious areas and said it wanted to promote the concept of a "shared space" at the centre of the town.
“There is no doubt that this deeply insensitive parade is causing great hurt and distress to many victims of terrorism in the west Tyrone area and the rest of Northern Ireland,” Ms Villiers said. “This Government has always made clear that politically motivated violence, by any side, was never justified and we condemn attempts to commemorate or legitimise terrorism.”
The Parades Commission has ruled that the republican event cannot proceed through the centre of Castlederg.
The Tyrone Volunteers Day event on August 11th will mark the deaths of Castlederg IRA men Seamus Harvey (23), and Gerard McGlynn (20), who died in 1973 when a car bomb they were understood to be transporting to the town detonated early.
The explosion happened about 5km away at an Irish customs post in Co Donegal.
Republicans in Co Tyrone hold the annual Volunteers Day to commemorate those who died in the conflict.
Rotating the venue and time to coincide with particular events and dates, Castlederg was chosen this year to mark the 40th anniversary of the deaths of the two IRA men. But the move provoked intense anger from some victims of IRA violence, who called for it to be banned completely.
Democratic Unionist First Minister Peter Robinson denounced the proposed event as “insensitive and inappropriate”.
The organisers had volunteered to alter the original planned route of the march, to avoid the town’s war memorial, but the Parades Commission has now placed further restrictions on the event, taking it away from the central Diamond area of Castlederg.
It has also made clear that no paramilitary style clothing, flags or other symbols relating to a proscribed organisation can be displayed by participants.
The Parades Commission has explained that the body has no power to ban a parade outright.
Sinn Fein councillor for Castlederg Ruairi McHugh has said the ruling to restrict the route had the potential to seriously undermine attempts by local republicans to address contention in the town and has argued the Commission’s determination made a mockery of the concept of creating a shared space in the centre of Castlederg.
PA