Domenech took over as national boss in 2004, having guided France to a second-place finish at the 2006 FIFA World Cup.
Despite the increasing pressure on Domenech following Les Bleus' early exit at Euro 2008, the French Football Federation (FPF) will reportedly give the 56-year-old coach another chance.
However, FPF has told Domenech that he will have to make some profound changes to give his squad a "different face".
"Domenech will have to present a more conquering and ambitious team, capable of quickly returning to the highest international level," said FPF president Jean-Pierre Escalettes.
According to reports coming from France, Domenech has until the end of the year to prove whether he can stay in charge of the squad.
The French national team will play Austria on the 6th of September, Serbia on the 10th of the same month and Romania on the 11th of October, after which the federation will ponder on Domenech's position.
"The priority is the qualification for the 2010 World Cup. If that is compromised, the federation will review his position," Escalettes added.