Sinner’s withdrawal is expected to make world number two Alexander Zverev and Canadian Felix Auger-Aliassime the first and second seeds at the tournament which runs from August 1 to 13.
Seven-times Grand Slam champion and world number three Carlos Alcaraz was ruled out already with a wrist injury.
“After carefully considering all the factors together with my team, we have made the difficult decision to withdraw from Montréal. It is never easy to miss such an important event, but we believe this is the right decision to prioritize my health. I’m disappointed not to be there, but I look forward to returning to Montreal in the future,” Sinner said in a statement.
The 24-year-old Italian defended his Wimbledon title this month with a four-set win over German Zverev to claim his fifth Grand Slam title.
Djokovic, 39, reached the Wimbledon semi-finals, where Sinner defeated him in three sets.