Shea has been limited to just four appearances since arriving at Victoria Road on a season-long loan looking to gain regular first-team experience, the most recent of those coming in Saturday`s 1-1 FA Cup draw against Walsall.
And the Gunners do not see that as real development for the highly-regarded 20-year-old, who does not have a league start to his name.
Daggers manager John Still said: "I'm sorry to see James go, he's been a pleasure to have in and around the club but unfortunately Arsenal have recalled him due to his lack of first-team opportunities.
"This has been down to the inspired form of Chris Lewington who, I'm sure everyone will agree, has been superb for us this season.
"James goes with best wishes from myself and all the coaching staff for the future."