Micah has not played for club side Lyon in over a month after copping a head knock in training.
She was named in the Matildas squad on Thursday but Football Australia announced on Saturday that she would be replaced by Brisbane Roar No.1 Chloe Lincoln.
Micah has suffered her fair share of head knocks over her career and lost her status as Australia's first-choice 'keeper in the lead-up to the 2023 World Cup as she recovered from concussion.
"I am truly devastated to have to withdraw from the Asian Cup," Micah wrote on Instagram on Saturday.
"I recently sustained another concussion and although I have pushed my hardest to be back in time, I am simply just not ready.
"The timing feels absolutely cruel… and sometimes football and elite sports can break your heart and truly test you not just as a player but as a person.
"My priority is my health, my long term career and to get back to playing here in OL."
Micah's withdrawal will mean Mackenzie Arnold becomes coach Joe Montemurro's No.1 for the tournament which kicks off on March 1 when Australia face the Philippines in Perth.
Lincoln has won just three caps and joins Arnold and the uncapped Jada Whyman in Montemurro's squad.
"Chloe has earned this opportunity through her hard work and professionalism," said Brisbane A-League Women coach Alex Smith.
"We're incredibly proud to see her receive national recognition and we know she'll represent both Brisbane Roar and Australia with pride."
Australia's squad will assemble in Perth next week ahead of their opening match.
They will also face Iran on the Gold Coast on March 5 and then meet South Korea in Sydney on March 8 in their two remaining group games.
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