Organisers of the Tokyo Olympics originally floated the idea of setting clocks back one to two hours after scorching heat this summer killed at least 120 people, raising concerns about the safety of athletes, particularly marathon runners.
The Games will be held in late July and early August, Japan's hottest, most humid months.
"I'd like to introduce this, but given problems with IT systems and changes in public opinion, it's difficult to actually do so," Asahi quoted Toshiaki Endo, a senior official of the ruling Liberal Democratic Party who heads a committee considering the proposal, as saying.
Japan will continue to discuss with the International Olympic Committee about how to protect marathon runners and speed walkers from the heat, it quoted Endo saying.
Three-quarters of Japanese firms oppose the proposal to adopt daylight saving time ahead of the 2020 Tokyo Olympics, a Reuters poll showed on Friday, citing the time and effort to adjust computer systems as well as disruptions to public life.
Japan is among a handful of major economies that does not use daylight saving time during the summer.
South Korea set its clocks back an hour in 1987 and 1988, when it hosted the Summer Olympics in Seoul. After the Games it reverted to a regime of no daylight saving time.
(Reporting by Stanley White; Editing by Gareth Jones)
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