The 28-year-old Horwill, known as 'Big Kev', missed the entire 2012 international season with a torn hamstring and another injury in training on Tuesday has sidelined him out for at least two weeks.
"It's extremely disappointing to lose James but after discussions with medical staff we felt it was important not to risk further injury when he isn't ready," Wallabies coach Ewen McKenzie said.
"Scans revealed his injury was on the lower-end in terms of severity and we expect him to be back to full fitness when we embark on our two-game tour of South Africa and Argentina in a few weeks."
Scrum-half Will Genia will captain his country for the fourth time in the lock's absence.
"Will is a proven leader and has had plenty of success as captain for the Queensland Reds and also for Australia," McKenzie added.
"He is a player that thrives with the added responsibility and he has always stepped up when given the opportunity to lead. I'm sure this will bring the best out of him."
Kane Douglas has been brought into the second row for Saturday's clash with the Springboks at Lang Park in Brisbane with Western Force loose forward Ben McCalman coming onto the bench.
If required, blindside flanker Scott Fardy can slot into the second row, with Ben Mowen shifting from number eight to the side of the scrum and either McCalman or potential debutant Jake Schatz coming off the bench to replace Mowen.
The Wallabies' second row stocks have been depleted with Hugh McMeniman and Peter Kimlin also out injured, with local media reporting Sitaleki Timani will join the squad as cover for their next match against Argentina in Perth on September 14.