Horwill suffered a slight strain during training on Tuesday afternoon and has been replaced by Kane Douglas in Australia's second-row, while Will Genia will captain the team at Suncorp Stadium.
No 8 Ben Mowen is the new vice-captain while Ben McCalman has been promoted to the bench.
Scans on Wednesday revealed only minor damage but the Wallabies are taking a cautious approach by also keeping him out of next week's test against Argentina in Perth.
"It's extremely disappointing to lose James but after discussions with medical staff we felt it was important not to risk further injury when he isn't ready," said coach Ewen McKenzie.
"Scans revealed his injury was on the lower-end in terms of severity and we expect him to be back to full fitness when we embark on our two-game tour of South Africa and Argentina in a few weeks."
McKenzie has backed world-class halfback Genia to step up in Horwill's absence and lead from the front against the Springboks at Suncorp Stadium.
Will is a proven leader and has had plenty of success as captain for the Queensland Reds and also for Australia, he said.
He is a player that thrives with the added responsibility and he has always stepped up when given the opportunity to lead.
"I'm sure this will bring the best out of him."
It remains a painful loss for the Wallabies as Horwill's size, power and leadership are valuable assets against the big Boks pack.
The latest blow to Australia's thinning second-row stocks - on top of injuries to Hugh McMeniman and Peter Kimlin - has seen former NSW Waratahs powerhouse Sitaleki Timani called into the squad to play the Pumas on Saturday week.
Originally overlooked by coach Ewen McKenzie after signing to play in France, Timani would likely add to his 10 test caps at Paterson Stadium.
Western Force back-rower Ben McCalman's call up to the bench highlights the lack of lock options.
Horwill's hamstring injury is not related to the horrendous tear he suffered last year which forced him to undergo surgery and miss the entire 2012 international season.
The inspirational 40-test lock returned strongly for the Queensland Reds in Super Rugby this season but his form dipped after suffering a calf injury during the Wallabies' 2-1 series loss to the British and Irish Lions in late June.
Wallabies: Israel Folau, Nick Cummins, Adam Ashley-Cooper, Christian Lealiifano, James O'Connor, Quade Cooper, Will Genia (capt); Ben Mowen, Michael Hooper, Scott Fardy, Kane Douglas, Rob Simmons, Sekope Kepu, Stephen Moore, James Slipper. Res: Saia Fainga'a, Scott Sio, Ben Alexander, Ben McCalman, Jake Schatz, Nic White, Matt Toomua, Jesse Mogg.
