The experienced Penrith forward has failed to recover from the hamstring injury that forced him to sit out last Saturday's semi-final victory over England.
Coach Stephen Kearney has called up Leeds second rower Greg Eastwood, who is one of four survivors from the Kiwis' World Cup-winning team from 2008, and will be vying with Alex Glenn to replace Pritchard.
"We made a final decision on Frank this morning," said Kearney. "He'd love to play and we'd love to have him there but the stakes are as high as they get this weekend and he's not 100 per cent.
"It's naturally very tough for him to be this close and ruled out but we're very happy with our cover."
Kearney has also included Jason Nightingale in his 19-man squad to provide cover for first-choice wingers Manu Vatuvei and Roger Tuivasa-Sheck, who have slight injury concerns.
As expected, full-back Billy Slater has been included in Australia's 19-man squad after making good progress in his recovery from a knee injury sustained in the Kangaroos' quarter-final win over the USA and a final decision is likely to be left until the day of the game.
If Slater is fit to return, Greg Inglis will revert to centre at the expense of Brent Tate, who could yet be handed a place on the bench, possibly at the expense of young forward Josh Papalii.
Australia: C Smith (Melbourne, capt), G Bird (Gold Coast), D Boyd (Newcastle), D Cherry-Evans (Manly), C Cronk (Melbourne), A Fifita (Cronulla), J Hayne (Parramatta), P Gallen (Cronulla), G Inglis (South Sydney), B Morris (St George Illawarra), N Myles (Gold Coast), J Papalii (Canberra), C Parker (Brisbane), M Scott (North Queensland), B Slater (Melbourne), J Tamou (North Queensland), B Tate (North Queensland), S Thaiday (Brisbane), J Thurston (North Queensland).
New Zealand: J Bromwich (Melbourne), G Eastwood (Canterbury Bulldogs), K Foran (Manly), A Glenn (Brisbane), B Goodwin (South Sydney), S Johnson (NZ Warriors), S Kasiano (Canterbury Bulldogs), K Locke (NZ Warriors), I Luke (South Sydney), S Mannnering (NZ Warriors, capt), B Matulino (NZ Warriors), J Nightingale (St George Illawarra), F-P Nu'uausala (Sydney Roosters), E Taylor (NZ Warriors), R Tuivasa-Sheck (Sydney Roosters), M Vatuvei (NZ Warriors), J Waerea-Hargreaves (Sydney Roosters), D Whare (Penrith), S B Williams (Sydney Roosters).