Cahill suffered the injury after colliding with goalkeeper Joe Hart in England's friendly win over Belgium yesterday, and after results from a scan taken yesterday were revealed today, the 26-year-old will not be taking part in the tournament.
Liverpool's Martin Kelly will replace Cahill in the squad heading to Poland shortly, even though he only made his international debut in the friendly against Norway eight days ago.
Despite only finishing in eighth place in the league, Kelly's introduction to the team means that there are now six Liverpool players in Roy Hodgson's 23-man squad, with just two players representing European Champions Chelsea.
The news means that more attention will be drawn to John Terry, who suffered a hamstring strain yesterday and whose injury will be re-assessed on Tuesday to determine whether or not he will be fit for the tournament.
England are now short of quality and experience in defense after Roy Hodgson chose to leave Rio Ferdinand and Micah Richards out of the team, with the only centre-backs being Terry, Joleon Lescott, Phil Jones, Phil Jagielka and now Kelly.
The likely partnership for England's first game of the tournament will be Terry alongside Lescott, but the pair have only started together twice for England, both times in comfortable victories against Andorra in qualification for the 2010 World Cup.
With Frank Lampard and Gareth Barry having been ruled out of the England team earlier in the week, England have to avoid any more injury setbacks before they begin their tournament against France on June 11th in Donetsk.