Novak Djokovic hitting a return during the 2021 ATP Cup (AFP)
There has been intense speculation as to whether he will travel to Australia, having refused to confirm if he has been inoculated against the coronavirus.
"World No.1 Novak Djokovic has withdrawn from the 2022 ATP Cup," organisers said in a statement ahead of Saturday's start to the team tournament.
"Team Serbia will now be led by world No.33 Dusan Lajovic."
Djokovic, the nine-time Australian Open champion, could win a record 21st Grand Slam title if he plays at Melbourne Park next month, but to enter Australia he and members of his entourage have to be vaccinated.
He has previously expressed his opposition to the vaccine and his father Srdjan said in late November that Djokovic would probably not play the first Grand Slam of the year, accusing the organisers of "blackmail".
Djokovic has been named in the entry list for the Australian Open, which starts on January 17, but he could yet withdraw. He was also originally on the entry list for the ATP Cup.
Tennis Australia has organised charter flights to bring international stars into Melbourne and Sydney.
Defending women's Australian Open champion Naomi Osaka was among those to touch down on Tuesday, but Djokovic was not on board. Players can also opt to fly commercial.
The ATP Cup has been hit by several withdrawals -- either because of Covid or injury -- and as a result France will replace Austria in Group B after Dominic Thiem and Dennis Novak pulled out, organisers said on Wednesday.
Team Russia's Andrey Rublev, who has Covid, Aslan Karatsev and Evgeny Donskoy have also withdrawn, the ATP Cup said, as has the USA's Austin Krajicek.
Covid looks set to cast a dark shadow over the Australian Open and the raft of tournaments in the country beforehand.
Spanish superstar Rafael Nadal, who was due to play a warm-up event in Melbourne next week, was among several players to have contracted the virus at an Abu Dhabi exhibition tournament this month.
His Abu Dhabi opponent, Wimbledon semi-finalist Denis Shapovalov, also later tested positive.
Three female players at the same event also tested positive -- Olympic gold medallist Belinda Bencic, US Open champion Emma Raducanu and Wimbledon quarter-finalist Ons Jabeur.
Earlier Wednesday, Nick Kyrgios urged Nadal and Djokovic to play at the Australian Open, saying it would be a "disaster" if the 'Big Three' were missing.
Swiss ace Roger Federer has already pulled out as he recovers from a knee injury and Nadal's plans are unclear.
The dominant 'Big Three' have won 20 Grand Slam titles each and Kyrgios said tennis still needs them, starting in Melbourne next month.
"I honestly don't know Novak's current situation with anything Covid-related or what he needs to play," the colourful Kyrgios told the Melbourne Age newspaper.
"I hope he's had a good Christmas and I hope he's able to play in the sport for as long as possible because I've voiced before I think Federer, Nadal and Djokovic need to be (playing).
"If all three aren't there, it's a disaster."
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