Rudisha's participation had been in doubt because of a slow-healing knee injury sustained while running in New York's Central Park.
"It is just not possible for David to effectively defend his world title in Moscow, so we announced this morning his withdrawal," his coach, Colm O'Connell, told Reuters on Tuesday.
Speaking from Iten, some 400km north-west of Nairobi, the Irishman said Rudisha's manager James Templeton had informed Athletics Kenya and the IAAF of the decision.
"He is improving, but the time factor is essential and a matter of concern to us. It's only one month to the worlds and we don't want to push and make it difficult for him and risk a recurrence of the injury," said O'connell.
The east African nation held its trials on Saturday and Anthony Chemut, Ferguson Rotich and Jeremiah Mutai earned 800 metre places in the squad heading for Moscow.
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