Nadal, 31, was forced to pull out of the 2017 season- ending ATP Masters last month due to a knee injury after an exhausting season in which he won the French and US Opens.
"It was a tough 2017 and I need to take my calendar in a different way in order to be ready," Nadal told the Mubadala World Tennis Championships website.
"For this reason, I have sadly announced to the organisers and now to you fans that I won't play this time in Abu Dhabi."
Nadal still plans on going for a 17th Grand Slam of his career in Melbourne next month.
The Spaniard will be replaced by compatriot Roberto Bautista Agut for the six-man event over three days from December 28-30.
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