The polarising Australian made his return to tennis after 18 months last week in Brisbane following knee surgery and wrist reconstruction.
He crashed out in the first round after three tough sets against rising French star Giovanni Mpetshi Perricard and conceded afterwards he was in pain.
Kyrgios also played two doubles matches with Djokovic and was due to face the Serb in a charity singles match on Thursday at Melbourne Park's Rod Laver Arena.
The Australian Open starts on Sunday.
"Unfortunately won't be able to play my good friend this Thursday on the 9th as I've had an ultrasound on my abdominal and have a grade 1 strain," he wrote on Instagram.
"Will be resting and doing everything I can to be OK by the Aus Open."
The 29-year-old, who always draws big crowds at the Australian Open, reached his maiden major singles final at Wimbledon in 2022, losing in four sets to Djokovic.
But he was never able to go further in an era dominated by Djokovic, Rafael Nadal and Roger Federer, coupled with his sometimes fragile temperament.
