With Rio Ferdinand announcing his decision to quit England duty on Wednesday, it was suggested it could pave the way for Terry to make a return to the international scene.
Reports emerged earlier this month that the Chelsea defender was considering featuring for England again after announcing his decision to step away from the national team last September.
However, Hodgson has explained Terry called him to clarify the rumours, with the England manager of the feeling the centre-back is planning to stick to his original decision.
"John did call me when stories broke to explain and my understanding is that he is in line with Rio and he is actually in retirement," said Hodgson.
"If push came to shove and we were desperate maybe we would turn to them - but it's a big 'but' and it's time to move forward.
"It's time for me to get behind the players who are there.
"I'm not going to call on younger players necessarily, but to get the behind the players I think will be the ones to take us to Brazil and do well for us."