The Serbian had earlier pulled out of Abu Dhabi exhibition and Qatar Open in Doha with elbow injury that has kept him out of action since Wimbledon past year. The 36-year-old, who won last year's Grand Slam title at the Melbourne Park, made a comeback to the tennis last week just four-and-a-half months after giving birth to her baby girl Alexis Olympia Ohanian Jr.
Williams is the latest big name to withdraw from the year's opening Grand Slam, which will be played from January 15 to January 28.
He was upset in Round Two of the Australian Open by Uzbekistani Denis Istomin, ranked 117th in the world at the time, and also lost in the Quarter Finals of the French Open to Dominic Thiem.
The former world No. 1 is uncertain for the Australian Open and there are genuine concerns over whether he will truly be able to return to the peak of his powers. "It was never going to be good enough for her to just compete".
"With that being said, and even though I am disappointed about it, I've decided not to compete in the Australian Open this year".
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Williams began last year's Australian Open one week after learning she was pregnant.
Williams said she isn't ready for top level tennis just yet.
The defending champion said in a statement on Friday that she was "not where I personally want to be".
"I've been in constant contact with Serena and her team and know this is why she has pushed it and pushed it until the 11th hour to make her final decision", he said. Murray joined Japanese star Kei Nishikori, who has been out of competitive action since last August after suffering a wrist injury during a practice session at Cincinnati and has also pulled out of the season-opening Grand Slam. The 12-time Grand Slam victor will also play the Tie Break Tens at Margaret Court Arena at Melbourne Park on January 10 in the evening, joining Rafael Nadal, Stan Wawrinka, Nick Kyrgios and Lleyton Hewitt in the field.