The latest figures show Scotland had 17,259 full-time equivalent officers at the end of June.
Chief Constable Iain Livingstone said to eliminate the force's multi-million-pound deficit as planned by 2021, this would have to be cut to under 16,500.
The force has retained an extra 400 officers, over planned numbers, for Brexit-related operations and secured £17 million of Scottish Government funding to cover this.
Papers discussed at the Scottish Police Authority (SPA) board meeting in Stirling today show the extra officers and Brexit costs had pushed the operational budget deficit for 2019/20 to £41.6 million, but it has now dropped to £24.6m.
Speaking at the meeting, Mr Livingstone outlined concerns over the financial position and officer numbers.
He said: "The truth is that our current workforce numbers are not sustainable against the allocated budget we have."
The budget plan for 2019/20 includes reducing officer numbers to 16,834, excluding the 400 Brexit officers, to cut the deficit.
However, he warned the three-year financial plan agreed by the board last year requires a further reduction of 350 officers next year to be on course to eliminate the deficit by the end of 2020/21.
He said: "Bluntly our financial plans for this year and next, based on projected funding allocation and excluding the completely unforeseen demands of the policing consequences of Brexit, mean that to eliminate our deficit by March 2021 we would require to reduce officer numbers to less than 16,500, while also taking any future funding reductions by external partners such as local authorities into account."
He warned Brexit and other political upheaval including a possible general election or further referendums mean Police Scotland face "potentially unprecedented demands" in the coming months, characterised by the "potential mass deployment of officers".
He added: "I identify three basic options for policing in Scotland going forward.
"We either maintain the workforce with no increase in funding, but clearly an increasing deficit that will not give us the sustainable, stable base that we seek.
"We reduce the workforce to eliminate the deficit, which would be a challenge given the significant operational demands that we face in the short to medium term.
"Or we are successful in securing additional funding."
SPA chairwoman Susan Deacon said: "I think its welcome, chief constable, for you to set out with such clarity your view about the various options going forward.
"There are significant issues and gaps there in terms of how we fund the police service going forward."