Playmaker Thiago was part of the Spanish under-21 team that won the European Championship in 2011, scoring against Switzerland in the final, and was a key member of Olympic coach Luis Milla's squad.
"Tests were conducted today to assess the state of Thiago's tibia injury and confirmed that the injury had not been overcome," Barca said on their Twitter feed.
"Thiago will continue with the recovery process in coming weeks and will not be able to be given the all-clear before the Olympic Games," they added.
Spain have been drawn in Group D alongside Japan, Honduras and Morocco for the Olympic football competition and begin their quest to repeat their 1992 gold-medal triumph against the Japanese on July 26.
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