"This squad remains largely unchanged after a fantastic series win against India," national selector Rod Marsh said on Monday.
"We have selected Adam Zampa as the spinning option for this tour in place of Nathan Lyon."
Australia want their leading spinner to return to domestic action to prepare for the upcoming two-Test series in New Zealand.
"This will give us a chance to have a good look at Adam ahead of the ICC World T20," Marsh added. That tournament takes place in India during March and April.
But there was no place for Khawaja despite his man-of-the-match winning performance in the BBL final on Sunday night when he hit 70 off 40 deliveries.
Selector Mark Waugh led a charge for Khawaja's inclusion, arguing that he was the top opener in the world today.
"He is batting as well as anyone can possibly bat," Waugh said.
Sydney's Daily Telegraph said Monday that if Khawaja was not in the squad, "it will be the biggest embarrassment of the summer and create uproar in cricketing circles."
"We know one of the biggest challenges we will face in New Zealand is adapting to the change in conditions," he said.
"The New Zealand side will be very tough to beat in their home conditions.
"We know we will need to be at the top of our game if we want to be competitive."
The Chappell-Hadlee Trophy series starts in Auckland on February 3 and moves on to Wellington on February 6 and Hamilton February 8 with the Test matches to follow.
Australia: Steve Smith (capt), David Warner, George Bailey, Scott Boland, James Faulkner, Aaron Finch, John Hastings, Josh Hazelwood, Mitchell Marsh, Shaun Marsh, Glenn Maxwell, Kane Richardson, Matthew Wade, Adam Zampa.
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