The 54-year-old has stated that he will 'calmly evaluate' whether the striker belongs in his squad for Euro 2012 following the Italian's red card against the Gunners
The Manchester City striker saw red late in the 1-0 loss to the Gunners for a foul on Bacary Sagna after escaping a similar punishment early on following a hard tackle on Alex Song.
In February, Prandelli admitted that the controversial striker could be left out of his plans for the competition in Poland and Ukraine because of his temperament, but the 54-year-old coach played down the former Inter star's actions in Sunday's match.
"I saw his sending off, but this time it was for a foul that was part of the game," he is quoted by Eurosport as saying.
"I do not think the code of ethics can be applied in this particular situation.
"I will calmly evaluate his position as far as the squad for Euro 2012 is concerned, but I repeat, his dismissal was for a foul that was part of the game."
After the match, Manchester City coach Roberto Mancini stated that Balotelli would not play for the club again this season and admitted that the 21-year-old could be sold in the summer.
Inter technical director Marco Branca conceded last week that the Nerazzurri will consider reacquiring Balotelli, who left San Siro for the Premier League club in 2010.