The world No.1 intends to file an injunction in an attempt to stop the deportation.
Health Minister Greg Hunt confirmed on Thursday that Djokovic would have to leave the country following the cancellation of his visa.
"The advice I have is that the ABF (Australian Border Force) can confirm that Mr Djokovic failed to provide appropriate evidence to meet the entry requirements to Australia and his visa has been subsequently cancelled," Hunt told Channel 7.
"It's a matter for him whether he wishes to appeal that but if a visa is cancelled, somebody will have to leave the country
"That follows a review of the exemption which was provided through Victorian government processes."
In an extraordinary, escalating soap opera, the world's best men's player had been left stranded overnight in a police-guarded room at Melbourne Airport after a 14-hour flight from Dubai.
Djokovic may have been armed with the vaccination exemption that will allow him to compete in Melbourne but with a visa that did not allow for medical exemptions.
That prompted the Victorian government to say it would not support Djokovic's application, putting his fate in the hands of the federal government and Prime Minister Scott Morrison.
The situation left Djokovic's father Srdjan telling the Serbian B92 internet portal: "Novak is currently in a room which no one can enter. In front of the room are two policemen."
Djokovic's entourage includes his coach, 2001 Wimbledon champion Goran Ivanisevic, who stated the obvious in a social media post after their arrival.
"Not the most usual trip from Down Under," he posted on Instagram with a selfie from an airport lounge, accompanied by face-palm and mind-blown emojis.
The 34-year-old Djokovic, never a stranger to controversy, has found himself the subject of a major public backlash in Australia after revealing on Tuesday that he'd received the vaccination exemption which allowed him to bid for a record 21st major title Down Under.
But amid the storm, Australian Open tournament director Craig Tiley insisted the world No.1 was getting no special treatment.
Victoria's Acting Sports Minister Jaala Pulford confirmed the state government did not support his visa application - declaring on Twitter "visa approvals are a matter for the Federal Government, and medical exemptions are a matter for doctors".
As Djokovic was left in isolation, there were also growing demands for him to clear up any doubts over the reasons for why he'd been given the exemption.
Rod Laver, fearing that Djokovic's participation on the court named after him at Melbourne Park could see passions running high, wants the Serb to open up.
"I think it might get ugly. I'd think the Victorian people would be thinking, 'Yes I'd love to see him play and compete but at the same time, there's a right way and a wrong way'.
"If he's got a reason for (the exemption) then ... we should know it."
Australia's world No.1 Ash Barty said: "I think it's a tough one. As we've seen a little bit in the last day or so, from the Australian public, I know how hard it has been for Australians... but in particular Victorians have had a real rough trot over the last 18 months and two years.
"I understand why they may be frustrated with the decision.
"Ultimately, I have no interest in speaking about Novak's medical history. It's not my decision. Those decisions are made. They're completely out of my control."
