"We're sad to announce that @mariasharapova has withdrawn after doctor's advice regarding her left arm," a post on the tournament's Twitter feed said.
Sharapova played her first US match in more than two years on Monday, defeating American Jennifer Brady 6-1 4-6 6-0 in an opening-round match at the hardcourt event in Stanford, California.
"Toward the end of the Monday night's match, I felt pain in my left forearm," Sharapova said Wednesday. "After yesterday's scan, the doctor has recommended I don't risk further injury."
Seventh-seeded Ukrainian Lesia Tsurenko advanced by walkover as a result of wildcard entrant Sharapova's early exit.
"Unfortunately, I have to withdraw from today's match," Sharapova said. "Monday night's crowd was so special and I wish I could continue playing but I have to make a preventative decision."
Sharapova told supporters after her Monday match that her cheers meant a great deal to her.
"I feel like I just want to hug everyone and say thank you," Sharapova said Monday. "It's my first match in the States in a really long time, and it's the closest thing to home for me."
Sharapova, 30, returned to competition in April, but her comeback was disrupted by a hip injury that forced her to withdraw from Wimbledon qualifying.
Sharapova's ranking has fallen to 171 in the world.
"I feel like I'm playing catch-up against everyone who has had a head start," Sharapova said after her match. "All that matters is that I keep playing."
The other day session singles match saw No.5 seed Ana Konjuh edge Natalia Vikhlyantseva 6-4 7-5 to advance to the last eight, where she'll face Garbine Muguruza who cruised past American teenager Kayla Day 6-2 6-0.
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