Henry Nicholls has been named in the 14-man squad and is expected to become New Zealand's 269th test cricketer, replacing Taylor at No 4 in the order.
Nicholls' 61 off 67 balls on Wednesday in the opening ODI against Australia, and match-winning 82 against Pakistan in Wellington, underlined his development this summer.
Taylor's fitness will continue to be monitored ahead of the Christchurch test.
BJ Watling's back also faces scrutiny, with Luke Ronchi named as cover.
Tim Southee returns to the squad after recovering from a bruised foot bone. Mitchell Santner is named as the only spinner, meaning no place for Mark Craig.
Matt Henry and Corey Anderson get recalls.
Coach Mike Hesson said Nicholls deserved his selection and that it was a squad picked with conditions in mind.
"Henry has been impressive the way he's made the step up to international cricket and we're confident of the job he can do for us in the top order."
"We've gone for just the one spinner in Mitch [Santner] and that's based around what we expect the pitches to play like at Hagley and the Basin.
"Tim's a leader within our group and our most experienced bowler, so we're excited to have him fit."
"Matt also comes back into the squad after some really strong performances throughout the summer and with Corey's return we now have a number of seam bowling options to consider.
The two-match series begins in Wellington next Friday, which will also represent Brendon McCullum's world record 100th consecutive test since debut.
Black Caps test squad to play Australia:
Brendon McCullum (c)
Corey Anderson
Doug Bracewell
Trent Boult
Martin Guptill
Matt Henry
Tom Latham
Henry Nicholls
Mitchell Santner
Tim Southee
Neil Wagner
BJ Watling / Luke Ronchi (wk)
Kane Williamson
