The 24-year-old was expected to be one of England's most influential players on the tour and his loss is a blow to the tourists' hopes of winning an Ashes series on Australian soil for the first time in 24 years.
"Stuart has a torn abdominal muscle and as such will take no further part in the current Ashes tour of Australia [ Images ]. Given the nature of the injury Stuart has been ruled out of the forthcoming ODI series against Australia as well," England's medical officer Nick Peirce said in a statement.
"Stuart will return to England shortly to commence a rehabilitation programme and we expect him to make a full recovery in time for the World Cup next year," he added.
Broad, who played a key role in England winning the Ashes on home soil last year, managed to bowl just 11 overs in Australia's second innings of the second Test on Monday.
"Playing for England in an Ashes series in Australia has been something I've dreamed of for a long time so to have that cut short by injury is devastating," he said.
"So far the series has been everything I had anticipated and knowing I'll play no further part is quite hard to take," he added.
"Given the way we had started the series I was looking forward to playing a leading role in England retaining the Ashes but that's not to be.
"Injuries happen and there's nothing I can do about it other than make sure I get stuck into rehabilitation and come back stronger in time for the World Cup next year," he added.
England are likely to call Chris Tremlett into the team as replacement for Broad for the third Test in Perth.