When he won the PGA Championship at Kiawah Island last year, the 51-year-old American became the oldest major victor in history.
He hasn’t played since February, following backlash over remarks he made regarding the Saudi-backed LIV Golf series.
For the first time in 28 years, he failed to qualify for the masters.
After criticizing the Saudi regime, Mickelson lost several sponsors and his reputation was ruined, but he sought to acquire control over the PGA Tour by joining a Saudi Arabia-backed golf super league.
He was named to the 156-man field for the second major of the year, which will be held at Southern Hills from May 19-22.
On Twitter, the PGA of America said: “Phil Mickelson has pulled out of the PGA Championship, according to our sources.
“We would have welcomed Phil, who is the defending champion and is currently eligible to join the PGA as a life member, to play.
“We wish Phil and their wife Amy all the best and look forward to seeing him back on the golf course.”
The first of eight LIV Golf events, worth $255 million (£207 million), will be held at Centurion Club near London in June.
Norman has stated that he intends to reveal some of the fields next week, ahead of the PGA Championship, with the final field to be revealed on May 27.
The PGA Tour granted permission to Mickelson, Sergio Garcia, and Lee Westwood to participate.
The PGA Tour, however, declined to release players who wanted to compete earlier this week.
Former world number one Norman, 67, sparked controversy by telling reporters during a press conference about Saudi Arabia’s human rights record and the murder of journalist Jamal Khashoggi, “we’ve all made errors.”