Roger Federer will miss the rest of the season, including the Rio Olympics and US Open.
The 34-year-old said he had been advised not to play again this year in order to fully recover from the knee surgery he had in February.
"I'm extremely disappointed to announce that I will not be able to represent Switzerland at the Olympic Games in Rio and that I will also miss the remainder of the season," the 17-time grand slam champion said on his official Facebook page.
Federer, who was forced to undergo surgery for the first time after suffering a freak knee injury running his daughters a bath, missed the French Open with a back injury, ending his record-breaking run of 65 consecutive grand slam appearances, but returned to reach the semi-finals of Wimbledon, where he lost to Milos Raonic.
But he has now been advised that he needs more time off.
Federer, who lost to Andy Murray in the men's singles final at the London Olympics after winning gold alongside Stan Wawrinka in the doubles in Beijing in 2008, added: "Considering all options after consulting with my doctors and my team, I have made the very difficult decision to call an end to my 2016 season as I need more extensive rehabilitation following my knee surgery earlier this year.
"The doctors advised that if I want to play on the ATP World Tour injury free for another few years, as I intend to do, I must give both my knee and body the proper time to fully recover.
"It is tough to miss the rest of the year. However, the silver lining is that this experience has made me realise how lucky I have been throughout my career with very few injuries.
"The love I have for tennis, the competition, tournaments and of course you, the fans, remains intact. I am as motivated as ever and plan to put all my energy towards coming back strong, healthy and in shape to play attacking tennis in 2017."