The European Squirrel Initiative (ESI) said the grey squirrel is an invasive, non-native species which is dominating the UK woodland.
It has urged the commission to use airguns to eradicate them, saying they are carriers of the squirrelpox virus.
The virus is deadly to red squirrels.
Grey squirrels are not affected by the pox and the Forestry Commission said shooting greys with air rifles was "not an effective or humane form of control".
Red squirrels are native to the UK but their population has dwindled to about 140,000, compared to more than 2.5m greys.
The ESI was set up to restore the native red squirrel as the dominant species throughout the continent.
Its chairman Andy Wiseman said: "We're not talking about members of the public going about shooting grey squirrels, but authorised volunteers and contractors, who are highly experienced, trained and insured.
"By banning the use of airguns, the Forestry Commission is undermining the landscape-scale approach necessary to control the spread of grey squirrels, an approach which has overwhelming public support."
A Forestry Commission spokesman said it needed to put the safety of the general public first.
"The Forestry Commission works with many squirrel groups and other organisations to help ensure the long-term survival of red squirrels in England," he said.
"We do not generally allow any other people other than our own professional rangers to use any firearms on the public forest estate.
"The majority of it is open for anyone to freely walk around and we put their safety first."
The commission said it was working on more humane ways of managing forests to allow the red squirrels to thrive.
Red squirrels can still be seen at several National Trust conservation areas in England, including Formby in Merseyside, Aira Force in the Lake District, Borthwood Copse on the Isle of Wight, Brownsea Island in Dorset and in Northumberland.
A wildlife organisation has criticised the Forestry Commission over its policy of dealing with grey squirrels and claimed the animals should be culled with airguns.