Werner hobbled off early in Leipzig's 4-0 Champions League win over Shakhtar Donetsk on Wednesday.
"Scans today in Leipzig showed that he has unfortunately torn the syndesmosis ligament in his left ankle and will therefore be out for the rest of 2022," the Bundesliga team said in a statement.
Werner has scored 24 goals in 55 international appearances for Germany and netted five times during qualifying.
"This news is very bitter," said Germany coach Hansi Flick. "I'm very sorry for Timo personally because he's missing out on the World Cup, which he really wanted to play.
"But Timo's absence is a great loss, especially for the team. We have to have an excellent striker with a strong goal rate in the national jersey and we'll also be without a real team player.
"First of all, we all wish that Timo gets fit again quickly."
Werner rejoined Leipzig from Premier League giants Chelsea in the close season and has contributed nine goals already in all competitions this campaign.
Germany kick off their bid for a record-equalling fifth World Cup against Japan on November 23rd in Al Rayyan, before further Group E matches against Spain and Costa Rica.
Bayern Munich winger Leroy Sane is also currently sidelined with a knee injury, with Werner's absence adding to Germany coach Hansi Flick's problems up front.
Borussia Dortmund youngster Karim Adeyemi and in-form Werder Bremen striker Niclas Fullkrug could be possible replacements for Werner in the squad.
Germany captain and goalkeeper Manuel Neuer has not played since October 8th due to a shoulder injury and is also a doubt for the global showpiece.
Flick will name his 26-man squad for the tournament on November 16th.
