The Morecambe Missile has been racing this week, despite breaking his wrist in a off-road motorbike accident just 11 weeks ago.
A spokesman for Padgett’s Honda told the BBC that the decision was jointly made by the racer and the team.
“This is a joint decision made with John as we don’t want the wrist injury to cause him any further issues,” he said.
“We love our racing and our riders. He is part of our family.”
John will still race in Wednesday’s TT Zero machine for electric bikes.
The 42-year-old Padgett’s Honda racer is just six wins away from Joey Dunlop’s all-time record of 26 TT wins.