Defending champion Rybakina pulled out of the tournament on Saturday, saying she was not physically ready to compete, leaving Ukraine's Marta Kostyuk to take her place in the eight-player field at Indian Wells.
Muguruza, the former world number one and two-time Grand Slam champion, said she had spoken with Rybakina and that the Kazakh had been unable to recover in time after struggling with physical problems late in the season.
"We love Elena, and we know that she was feeling so-so in Tokyo as well," Muguruza told Reuters.
"I spoke to her today, and she really couldn't recover in time.
"What we want is for her to feel good, to go rest, to recover. We don't want her to feel like she has to play - only if she's ready to."
Rybakina, who won two Grand Slam titles this year, also withdrew from the Tokyo quarter-finals last month because of a neck injury.
'Amazing field'
Rybakina's absence deprives the event of some star power, but Muguruza said the round-robin format and depth of the field would ensure a high-quality tournament.
"We have the best players," said Muguruza, who triumphed at the WTA Finals in Guadalajara in 2021.
"I know our world number one is not going to be able to play, but we have an amazing field, the very best.
"Every match could be a Grand Slam final. You really need to be ready. You cannot give one inch."
Kostyuk, who is making her WTA Finals debut after a breakthrough season that included the Madrid title and a rise into the top 10, was already in Indian Wells as an alternate and practising when Rybakina withdrew.
Muguruza said the Ukrainian, known for her signature post-match backflip celebrations, had earned her opportunity.
"Marta is great. She's had a breakthrough year," Muguruza said. "With this year, we have many first-time players in the Finals, and that's very exciting. It's very hard to qualify."
Kostyuk has been outspoken about Russia's invasion of Ukraine and does not shake hands with Russian or Belarusian opponents. Muguruza said the tournament would support players in making their own decisions.
"They're free to do whatever they feel," she said. "We are open and supporting them."
Chance for Sabalenka and Andreeva
Rybakina's withdrawal could create an opening for world number two Aryna Sabalenka to make inroads in the rankings.
Sabalenka, who won the Indian Wells title earlier this year, has the chance to reduce the gap with Rybakina at the top of the rankings, Muguruza said, while also highlighting Russian teenager Mirra Andreeva as a player comfortable in the California desert.
"Of course, Aryna might be thinking that this can be a good opportunity," Muguruza said.
The WTA moved the Finals to Indian Wells from Riyadh, with Muguruza saying player safety had been the decisive consideration amid conflict in the region.
"It clearly felt no longer safe to be in a region where there is conflict," she said.
"Taking care of the players and looking ahead to what could be safe, comfortable and secure, relocating felt the best decision."
Muguruza said players had responded positively to the switch to Indian Wells, where she competed regularly during her career.
"When we knew that Indian Wells could be the next venue, it was just a joy," she said, adding that ticket sales have been strong. "The whole thing is just perfect."