The 52-year-old actor and singer had been ordered by doctors to take time out to recover several weeks ago, and it had been hoped he would be able to return to the ice this weekend.
But Donovan said: "I am devastated to announce that due to this ongoing back issue that occurred on Dancing on Ice about 10 days ago, and at the advice of my medical team in the show, that unfortunately I can't continue in the competition and therefore have to withdraw.
"We put so much work into getting to this point but I have to respect my health and I have to respect my body moving forward. That is my biggest priority."
Watch: Phillip Schofield gives Jason Donovan a Joseph and the Amazing Technicolour Dreamcoat test
The former Neighbours star thanked the Dancing On Ice team, especially the celebrities "who have become friends".
He added: "Most importantly I want to thank Alex [Schauman], my dance partner, who's been absolutely a beacon of support. She's believed in me when at times I didn't even believe in myself. She's been patient. And that time that we spent together on the ice - that to me has been what this whole experience has been about. And that friendship I have with her goes beyond the show."
A spokeswoman for Dancing On Ice added: "Our thanks go to Jason and his partner Alex for being so wonderful and committed to the series. We're sorry to see them leave and we wish Jason a speedy recovery."
The ITV celebrity skating competition was taken off air last week and replaced with a highlights show, after being hit by multiple injuries and positive coronavirus tests.
Now it only has five celebrities remain in the running, with several weeks to go until the final.
The unlucky number 13th series has already seen actor Denise Van Outen pull out due to a broken shoulder, while former The Only Way Is Essex star Billie Shepherd had to quit after a concussion.
Professional skater Hamish Gaman - partner of Coronation Street actor Faye Brookes - has quit the series after injuring his hand.
A pro skater Yebin Mok had to pull out of the series before it began after her partner Graham Bell accidentally stabbed her in the leg with his skate during training.
ITV are yet to confirm reports Plant and his partner may be permitted to return to the competition.
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