The 2011 champion said she arrived in Cincinnati on Saturday eager to play but following the doctor's advice on site decided to withdraw from the U.S. Open tune-up, where first-round action begins on Monday.
Sharapova was scheduled to play French Open champion and world number 12 Jelena Ostapenko in a highly-anticipated first-round clash.
The Russian's decision to withdraw marks the latest setback in her comeback this year after a 15-month doping ban.
Sharapova, banned after testing positive for the heart drug meldonium at the 2016 Australian Open, has had mixed results since rejoining the WTA Tour.
The 30-year-old reached the semi-finals as a wildcard in Stuttgart, fell in the second round at Madrid and retired from her second-round match at the Italian Open in mid-May after injuring her left thigh.
After pulling out of Stanford, Sharapova withdrew from the Rogers Cup in Toronto.
The arm injury casts a cloud on Sharapova competing in the Aug. 28-Sept. 10 U.S. Open since the former world number one would need a wildcard to compete in the event.
(Reporting by Frank Pingue in Toronto; Editing by Clare Fallon)
