Stewards stripped the 25-year-old of third place on the grid after post-qualifying checks on Saturday showed there was an insufficient quantity of fuel in the car for sampling purposes.
The ruling lifted Ferrari's Fernando Alonso, the Spaniard who is 13 points adrift of Vettel with three races remaining, to sixth place for the floodlit day-to-night race at the Yas Marina circuit where overtaking has been tricky in the past.
McLaren's Lewis Hamilton will start on pole position alongside Vettel's Australian team mate Mark Webber. Neither driver has any realistic hope of the title even if they remain mathematically in contention.
Red Bull's decision to start from the pitlane - rather than the back of the grid - means it will be able to make some changes to Vettel's car's set-up ahead of the race, and the driver himself remained positive.
"One of the best ski jumpers of all times once said 'Every chance is an opportunity and as far as we are concerned there are still plenty of chances tomorrow'," said Vettel after finding out about the penalty.
Red Bull principal Christian Horner, who had hoped to see his team clinch the constructors' title on Sunday for the third year in a row, said that the stewards' decision was "frustrating, annoying and one of those things.
"If he manages to get into the points tomorrow that would be a great achievement," he added.
Vettel had been told to stop immediately on track, to protect the engine, after qualifying as he returned to the pits.
Post-qualifying checks found there was an insufficient quantity of fuel left in the car to take a sample - only 850 millilitres instead of the mandatory one litre.
Horner said engine partners Renault were convinced the rest of the fuel was still in the tank but the team had taken the car out of 'parc ferme', where the cars cannot be worked on, to carry out further checks, meaning Vettel would start in the pit lane and not at the back of the grid.
"Sebastian was remarkably calm. He dealt with it and said 'Out of a negative comes a positive," said Horner. "He'll be maximum attack tomorrow.
"The rules dictate that a litre has to be able to be provided without removal of bodywork... we believe that the fuel is in the cell, according to what Renault have told us, but you can't dismantle the cell to give the sample.
"There's a long race ahead of us tomorrow and there's an opportunity. We'll attack the race and I'm sure Sebastian will demonstrate to everybody why he's a great racer.
"He's come from the back and produced great races before and I've got no doubt that he can do it again tomorrow."
Vettel's grid position was questioned after his team and their Renault technicians ordered him to stop immediately on the track as he headed back to the pits after the chequered flag.
Red Bull were summoned to stewards to explain why the car had not been driven back to the pits under its own power, the same failing that sent Hamilton to the back of the grid at the Spanish Grand Prix after he had qualified fastest.
The decision was announced four hours and 40 minutes after qualifying had ended. The four stewards included Britain's former F1 driver Derek Warwick.
The stewards accepted telemetry evidence provided by the team that showed the car had stopped due to force majeure. However, the FIA technical delegate's report showed the fuel irregularity.
"The stewards determine that this is a breach of article 6.6.2 of the Formula One Technical Regulations and the competitor is accordingly excluded from the results of the qualifying session," the FIA statement said.
"The competitor is however allowed to start the race from the back of the grid."
Red Bull team principal Christian Horner said they had chosen instead to start from the pit lane so they could work on the car.
Horner said Vettel, who would have been chasing his fifth win in a row after leading every lap of the last three races, had taken the news calmly.
Before Saturday, champions Red Bull had locked out the front row of the last three races and were looking likely to secure the constructors' title on Sunday for the third year in a row.
"It's the first time for a long time to be ahead of the Bulls and starting at the front," said Briton Hamilton, who was last on pole in Singapore last month but has always started on the front row in the Emirate.
"The car has felt beautiful all weekend," he added after his 25th career pole and sixth of the season.
Vettel, who had brake problems that sidelined him for most of final practice in the afternoon, had played down the qualifying problem earlier.
Vettel also brushed the guardrail in the first part of qualifying, sending out sparks, but appeared to escape without damage. He and Hamilton are the only drivers to have won at the harbourside track.
Alonso, whose car has shown better pace on Sundays than Saturdays in recent races, said he had done the best he could in the circumstances.
"We were not competitive today. I'm happy with my performance. We struck the maximum," the Spaniard said.
Venezuelan Pastor Maldonado will move up to third for Williams with Finland's Kimi Raikkonen, third in the championship with Lotus, lining up fourth. McLaren's Jenson Button will start fifth.
Michael Schumacher, who has not scored a point for four races and is retiring at the end of the season when Hamilton takes his seat, starts 13th for Mercedes while team mate Nico Rosberg moved up to seventh.