Movistar's veteran has failed to recover in time from an edema to the sacrum he sustained while training for Liege-Bastogne-Liege in the final week of April, according to a team statement.
Meanwhile, La Gazetta Dello Sport reports Team Ineos' Bernal crashed on a slippery road during training and was to undergo surgery for a fractured collarbone on Sunday.
He told fans via Instagram "friends, do not worry, this only gives me more motivation to train hard for the rest of the season."
Ineos has not confirmed its plan B and according to the Italian newspaper, will also bench Gianni Moscon, alluding to lack of form.
But the Giro's loss will surely benefit the Tour de France as Bernal now has a free slot on his dance card in July, and likely serve team duties or light up the race himself. Valverde too is likely to suit up for Movistar at the Tour de France.