The 29-year-old, who won gold in the 100 metres hurdles at the London Olympics, had battled back after being sidelined for a year by a shattered wrist only to suffer the hamstring injury training at her base on the Gold Coast.
"It's a hard time for me at the moment. I'm disappointed and I'm gutted," Pearson told Australia's Nine Network on Wednesday.
"Unfortunately, it is the biggest sporting event in the world that I am going to be missing out on and I can't be a part of. It's devastating that I can't be at Rio as the Olympic champ."
Pearson's hopes of defending her title at the Aug. 5-21 Games had looked slim after a fall at the Golden Gala meeting in Rome last year shattered her wrist so badly, she feared her left forearm might need to be amputated.
The 2011 world champion, who also won silver at the 2008 Beijing Olympics, missed the back end of the 2015 season as a result of the fall and only returned to racing in Europe early this month.
Her results in three races in Birmingham, France and Oslo were disappointing, however, and she returned for a period of intense training in the warmer climes of her hometown on the Queensland coast.
COMING TOGETHER
She said upon her return home that she had "left nothing in the tank" but said on Wednesday she was finally starting to feel physically better before her hopes were crushed earlier this week.
"My body finally was starting to feel normal again, it was starting to feel the speed, the strength... it was all coming together," she said.
"Unfortunately on Monday, I went over the hurdles and felt two squeezes in my hamstring and my heart sank.
"I thought it was just a hamstring tear and it would probably take me a couple of weeks and I'd be all right. But the scans showed it was a tendon tear and any tendon takes a long time to recover."
Pearson, who is keen to compete at the 2018 Commonwealth Games in her hometown on the Gold Coast, said the danger of going to Rio and aggravating the injury would have hampered that opportunity.
"The risk of going to compete at the Olympics could do major damage to my hamstring," she said. "And there would be no chance of me competing at the Commonwealth Games on the Gold Coast in a couple of years time."
(Reporting by Nick Mulvenney; Editing by Greg Stutchbury/John O'Brien)
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