James blow for Wales
The 28-year-old has an ongoing foot injury and will continue his recovery with his region.
James returned to the Blues this year after two seasons with Exeter and last played for Wales in 2010.
James was a surprise inclusion in the initial squad after five seasons out of the international reckoning.
However, his injury meant he was not able to take part in training at the World Cup camps in Switzerland and Qatar.
Wales already have injury concerns over Liam Williams, who covers the wing and full-back positions.
The Scarlets player has a broken bone in a foot and is a doubt for the World Cup – with Wales starting their campaign against Uruguay on 20 September.
The Wales squad assemble in the Vale of Glamorgan on Monday ahead of their first warm-up match against Ireland in Cardiff on Saturday, August 8.
The 47-man squad will be reduced after the Ireland match, with the final 31-man World Cup squad due to be announced by coach Warren Gatland on August 31.