Her opponent, Australian Maddison Inglis, has a walkover into the fourth round.
Japanese 16th seed Osaka, the 2019 and 2021 winner at Melbourne Park, said on social media that her body needed attention following her previous match against Sorana Cirstea, without elaborating on the issue.
"I've had to make the difficult decision to withdraw to address something my body needs attention for after my last match," she wrote.
"I was so excited to keep going and this run meant the most to me, so having to stop here breaks my heart but I can't risk doing any further damage so I can get back on the court."
The pull-out is a setback for Osaka, who has been returning to her best and made the US Open semi-finals last year.
At Melbourne Park, Osaka made a huge splash before her opening match against Antonia Ruzic when she entered Rod Laver Arena in a jellyfish-inspired outfit, one of the boldest fashion statements seen at a Grand Slam.
More to follow...
