Instead, an abdominal injury has resulted in him missing another Masters 1000 event, his fifth absence from such a tournament this year.
Nadal was returning from a right knee injury which forced him to retire from the U.S. Open semifinals, but took medical advice not to play against Fernando Verdasco.
"These days I felt good but I have started to feel some abdominal pain", the 32-year-old "King of Clay" said, noting that his doctor recommended that he not play.
"I didn't want to play there at that time".
The world number three, who has already sealed a spot in the ATP World Tour Finals in London, wasn't sure about participating in the ongoing tournament, considering the way he was pushed to the limits during his title-winning run in Basel last week.
While Nadal has missed almost two months of action after retiring at the US Open with a knee problem, Djokovic has been going from strength to strength, and enters this week's event in Paris on the back of an 18-match winning streak and victories at Wimbledon, Cincinnati Masters and the US Open.
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Other matches on the card include Brock Lesnar vs Braun Strowman for the vacant Universal Title, AJ Styles vs. Samoa Joe for the WWE Championship and The New Day vs The Bar for the SmackDown Live Tag Team Championship.
Federer enjoyed a walkover into the third round when Milos Raonic pulled out with an injury. It's been a tough year for me with injuries.
The Swiss said: "I think both of us were far from our best, but we fought with what we had and at the end I think I maybe served a bit better in the important moments than Fabio did".
"I'm happy to play tomorrow".
Croatia's Marin Cilic will play Germany's Philip Kohlschreiber after he beat Robin Haase of The Netherlands 6-7, 6-4, 6-2.
Cilic moved closer to securing one of the remaining places for the ATP Finals in London.
Isner needs to reach the semi-finals in Paris to have any hope of moving up to ninth in the rankings, which would give him a chance of making the ATP Finals in London in November.
Fourth seed Alexander Zverev also cruised into the last eight with a 6-4 6-2 win over Diego Schwartzman.
The Australian Open champion is drawn in the same half as Djokovic; Cilic and big-serving Kevin Anderson, who upset Federer in the Wimbledon quarterfinals this year.