Schleck, who was handed the 2010 title after race winner Alberto Contador failed a dope test during the Tour, finished second overall last year and had been expected to challenge champion Cadel Evans of Australia and Briton Bradley Wiggins.
"I'm not going to be in it (the Tour)," Schleck told a news conference.
His doctor, Torsten Gerich, said the type of injury suffered by Schleck usually needed four to six weeks to heal and cycling was not possible.
The RadioShack-Nissan rider suffered the injury in a crash during an individual time trial in the Criterium du Dauphine earlier this month.
Schleck, 27 added that he was still looking forward to the Olympics and his main goal was the Vuelta (Tour of Spain) in August, where he is likely to face Spaniard Contador, who will be back from his doping ban.
His older brother Frank is now expected to be the team's leader on the Tour, which starts on June 30 in Liege, Belgium.