Gloucester's Jonny May has been called up as a replacement and will join up with the squad in Johannesburg on Saturday morning.
Lowe, 22, was forced off early in the second half of an England XV's 54-26 win over the Southern Barbarians in Kimberley on Wednesday.
He had earlier scored one of England's eight tries having been included in the side as a late replacement for David Strettle, who was rested ahead of the second Test against South Africa.
He will now return home for further medical assessment after undergoing a scan.
May, 22, flew out to South Africa overnight.
Head coach Stuart Lancaster said: "It's a shame for George because he had a good game against the Southern Barbarians until he was injured.
"But this is an opportunity for another young player who has come up through our age grade programme and into the Saxons to gain some valuable international tour experience."
Lowe follows two other players in having his tour ended prematurely.
Full-back Mike Brown was ruled out after suffering a thumb ligament injury in last week's first Test and was replaced by Nick Abendanon.
Forward Joe Launchbury returned home before the first game with a knee injury. Jamie Gibson took his place in the squad.
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