Relations between the two nations have been tense for decades over the disputed region of Nagorno-Karabakh and thousands of Azeri spectators booed and jeered the Armenian team loudly as it entered the Olympic stadium during the athletes' parade on Friday evening.
The hostile reception continued on Saturday when Armenian athletes were booed at the start of the wrestling competition.
"We have spent some time looking at a range of scenarios," Games chief Simon Clegg told reporters when asked whether he was concerned about crowds reacting to Armenian athletes' presence at the Games.
"I recognise there were some reactions from elements of the public to the marching of certain delegations, positive but also not so positive."
War erupted over Nagorno-Karabakh in 1991 as the Soviet Union broke up, killing about 30,000 people. A ceasefire was called in 1994 but violence has broken out sporadically since.
Nagorno-Karabakh has run its own affairs with heavy military and financial backing from Armenia since the war. Armenian-backed forces hold seven Azeri districts surrounding Nagorno-Karabakh.
The Armenian team has sent 25 athletes to the June 12-28 event after the intervention of International Olympic Committee President Thomas Bach last year.
They are competing mainly in wrestling and boxing but the country's Olympic chief has stayed away from Baku.
"Bearing in mind the difficulties between the two countries it demonstrates the power of sport that Armenia is here," Clegg said. "To have all 50 National Olympic committees (of Europe) marching sent an incredibly positive message.
"I hope that people will appreciate athletics performances irrespective of which country competes."
(Editing by Sudipto Ganguly)
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