With key players Chris Latham, Phil Waugh and Steve Larkham set to miss the majority of this year's Super 14 competition, and props Greg Holmes and Rodney Blake also having picked up knocks, Flatley is worried by the lack of depth in Australian rugby.
"We're a little bit stretched with all the injuries in the four (Australian Super 14) teams," Flatley told the Herald Sun.
"At the moment, Australian rugby has quite a few injuries floating around and we just don't have the depth that New Zealand and South Africa does."
Reds full-back Latham, who injured his knee in a pre-season training accident in January, has earmarked the Wallabies' Bledisloe Cup clash against the All Blacks in Melbourne on June 30 as his comeback match.
And with a fully-fit squad, Flatley believes the game is a good opportunity to build momentum before attempting to win their third World Cup in October.
He said: "They're always special games. For an Australian, the Bledisloe is the pinnacle of the game, barring playing in a big game in the World Cup.
"If we can get our best 22 together and keep fit around Bledisloes and the World Cup, then we've a chance of winning anything."