The 30-year-old Murray plummeted from third to 16th after not playing since July with a hip injury.
The Scot's last appearance outside the top 10 was in October 2014.
The three-time Grand Slam winner last appeared on court at Wimbledon, losing in the quarter-finals to American Sam Querrey.
Shortly after that he was nudged off the top of the world rankings by Rafael Nadal, who sealed the end-of-year top spot at the Paris Masters last week.
Murray is due to face world number two Roger Federer in a charity exhibition match in Glasgow on Tuesday before he starts his preparations for the Australian Open by playing in Brisbane.
The 12-time Grand Slam winner ends the year in 12th, down five places, for his lowest ranking since March 2007.
Djokovic is hoping to make a comeback at the exhibition World Tennis Championship in Abu Dhabi next month.
American Jack Sock, who beat Filip Krajinovic 5-7, 6-4, 6-1 in the Paris Masters final on Sunday, climbs 13 rungs to ninth in the ATP chart.
Sock's exploit in the French capital earned him a ticket to the World Tour Finals next week.
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