Pocock, who sustained the injury in the defeat to the All Blacks in Auckland two weeks ago, failed a late fitness test and has been replaced at number eight by Pete Samu, who will make his first test start on Saturday.
"Very disappointed for David and the team, he's been in outstanding form all year and a big leader in the team," said captain Michael Hooper.
"It's unfortunate but Pete's coming in and he's been doing a great job in the cameos he's been having off the bench. He'll be itching to go."
Australia lost both of last month's back-to-back tests against the All Blacks by significant margins and are desperate to kickstart their campaign at Lang Park.
Pocock is renowned as one of the best players in the game at the breakdown, securing turnovers by getting onto the ball quickly after the tackle and using his upper body strength to resist being pushed off his feet.
There has been an outcry in the Australian media and from some former Wallabies against the illegal "neck roll" tactic which some New Zealand forwards used to try and shift Pocock off the ball, a tactic which resulted in his injury.
Hooper, while saying that he did not think that anyone was deliberately out to inflict injury on a rival, said the "neck roll" was a "significant" issue of safety that World Rugby needed to address in consultation with players.
"We sent clips into World Rugby (but) were told it doesn't meet the red card threshold," the openside flanker added.
"Neck injuries are a pretty serious issue I know from being in a similar position to David, you want to be protected and safe. It's about player safety.
"It's now cost us David having to sit out and be concerned about a pretty vital part of your body. And as a fellow player, you've got to sympathise with that."
The Wallabies currently sit bottom of the tournament standings and could slip to an unprecedented seventh in the world rankings with a loss to South Africa on Saturday.
Updated team: 15-Israel Folau, 14-Dane Haylett-Petty, 13-Reece Hodge, 12-Matt Toomua, 11-Marika Koroibete, 10-Kurtley Beale, 9-Will Genia, 8-Pete Samu, 7-Michael Hooper (captain), 6-Lukhan Tui, 5-Adam Coleman, 4-Rory Arnold, 3-Allan Alaalatoa, 2-Tatafu Polota-Nau, 1-Scott Sio.
Replacements: 16-Folau Faingaa, 17-Tom Robertson, 18-Taniela Tupou, 19-Izack Rodda, 20-Ned Hanigan, 21-Joe Powell, 22-Bernard Foley, 23-Jack Maddocks.
(Reporting by Ian Ransom and Nick Mulvenney; Editing by Greg Stutchbury)
