Sharapova's announcement came just hours before she was to take the court for her opening match.
"I hurt my forearm in practice a couple of days ago and need to precautionarily withdraw, with the Australian Open starting in just a matter of time," Sharapova said. "This is such a special event for me, especially being the defending champion. I look forward to seeing all my fans in Brisbane next year."
Shortly after the No.3-seeded Sharapova withdrew, the tournament's No.1 seed, Simona Halep, was also forced to pull out, due to a left leg injury. She was going to play her opening match on Wednesday.
"I had problems with my Achilles in August and September, and then I didn't feel it anymore, but now I've already had a couple of weeks again with the pain," Halep told reporters. "I thought I would be ready to play here, to start the year here in Brisbane, but I don't think that I can play a full match.
"I think it's more important to be ready and take a little bit of a break."
Halep is scheduled to play the Apia International Sydney next week - and she's hopeful she will.
"Yeah, I'm planning to go to Sydney. Actually tomorrow I'm going there," the World No.2 said. "It's nothing dangerous - I did an MRI and it's nothing dangerous. But it's still an inflammation.
"I just have to take a few days' rest."
Despite Tuesday's withdrawals, the Premier event still has a dynamite field, led by 2015 Wimbledon finalist Garbiñe Muguruza. The No.2-seeded Spaniard will kick her campaign off on Wednesday.
Meanwhile, in second round play, No.8 seed Roberta Vinci cruised past Dominika Cibulkova in a battle of Grand Slam finalists, 6-1, 6-1, Anastasia Pavlyuchenkova won a see-saw against Alizé Cornet, 6-2, 1-6, 6-4, and No.6 seed Carla Suárez Navarro took on Samantha Stosur in the feature night match.
Ekaterina Makarova beat Gasparyan in the last first round match of the week, 6-4, 2-6, 6-3.