O'Connell will miss the Guinness Series opener against the Springboks at Aviva Stadium because of a back injury that shows no signs of clearing up.
"Paul returned to training at the start of this week and took a full part in the squad sessions on Monday and Tuesday," read a statement released by the Irish Rugby Football Union. "However, he suffered a reaction and will not be fit for selection for this weekend's game.
"Paul will see a specialist in the coming days and an update will be issued in due course."
The loss of O'Connell is a blow to Ireland, who have already had Brian O'Driscoll, Sean O'Brien, Rob Kearney and Rory Best ruled out of all three autumn Tests.
In addition, Stephen Ferris is struggling with an ankle injury and at best will feature only in the final game against Argentina.