The Paris Saint-Germain star had hoped to be declared fit in time for the tournament in Russia, but doctors from the CBF say he will require surgery, making his participation in the finals impossible.
"Close examinations confirmed the initial diagnosis of an anterior cruciate ligament injury, requiring surgical treatment", a statement read on the Brazil Football Federation website on Friday.
Pele went into the 1958 finals - where he won the first of his three trophies - with injury and was also hurt during the 1966 campaign in England, and he has some sympathy for his compatriot. Click any of these buttons below! "Dani Alves will be operated on when the condition of his knee permits".
He returned to Paris this week to complete the final stages of his rehabilitation. "However, the rest period required is incompatible with the constraints of optimal preparation for the coming World Cup".
The front-runners to be his replacement were Manchester City's Danilo, Corinthians' Fagner, and Bayern Munich's Rafinha.
The south American counter are the most successful country in the championship - winning the trophy five times in their history, followed by Germany and Italy with four titles each. He's an experienced player and it's the eve of the World Cup.
He was a FIFA World Youth Champion with Brazil in 2003.
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