With captain Sergio Ramos already out of both legs, having picked up a calf injury on international duty with Spain, Varane is now also on the sidelines tonight and the weekend's Clasico at home to Barcelona.
Eder Militao will now step up, partnered by Nacho Fernandez, in a second-string centre-back pairing.
The negative news continued on Monday as Zinedine Zidane confirmed Eden Hazard is not ready to face Liverpool as he continues to work his way back from his latest injury setback.
“Hazard needs to stay calm and be patient, the most important thing is that he is completely recovered and I don’t think we’ll hurry his return,” Zidane said. “If the player is in good shape then I’ll want to play him but right now we’re going to take things slowly and see what happens.”
Liverpool continue to have their captain, Jordan Henderson, sidelined, along with Virgil van Dijk, Joe Gomez and Joel Matip.
Diogo Jota produced a fine cameo off the bench against Arsenal and comes into the starting lineup, with Roberto Firmino dropping to the bench, while Georginio Wijnaldum and Naby Keita come into midfield.
"Our team is built for these kind of games, when we face a football-playing side. That's why we have a chance, absolutely," Klopp said.
"I heard outside that everybody says Real Madrid is favourite. Great! No problem at all with that. They are used to the role. If anybody knows how to win the Champions League, it's Real Madrid.
"And we have no problem with the role of challenger. I'm not determined to show the world how good we are, I want to show our fans that we are still fighting. That's much more important to me, to be honest.
"If people think because we don't play so well that I am not a good manager, then I don't like that but I don't care. We had some problems, which you know about, but we want to get whatever is possible out of this season."
Real Madrid starting XI: Courtois; Vázquez, Militão, Nacho, Mendy; Casemiro, ModriÄ, Kroos; Asensio, Vinícius, Benzema.
Liverpool starting XI: Alisson, Alexander-Arnold, Phillips, Kabak, Robertson, Fabinho, Wijnaldum, Keita, Mane, Salah, Jota