The US star said she suffered "further injury and damage" after returning to intense training following the second operation on her foot, which she cut on broken glass in a Munich restaurant in July.
"As I continue to rehabilitate my foot after the second surgery last month, it is with the utmost regret that I am withdrawing from the Hopman Cup and the 2011 Australian Open Championships," she said in a statement.
"As I recently learned, pushing myself back into my intense training too early only caused me further injury and damage.
"While I desperately want to be back on the court and competing in the first Grand Slam tournament of the year, it is imperative for my health that I continue to work with my doctors to ensure my foot heals properly."
Williams, a 13-time Grand Slam champion, sealed her fifth Australian Open title last January, beating Belgium's Justine Henin in the final.
The 29-year-old was earlier forced to acknowledge she would miss the rest of this season because of the injury, which she suffered shortly after sealing her fourth Wimbledon title.
"This decision, though heavy on my heart, is the right one," Williams said.
"I am praying for a healthy recovery and I promise my Aussie fans and my fans around the world that I will be back better than ever as soon as I can be."
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