The Belarusian was due to play Caroline Wozniacki in the quarter-finals on Thursday night before she pulled out of the tournament with a foot problem.
"It's a right foot injury, and there is a big inflammation in both and tendinitis," Azarenka said in a statement.
"Around tendinitis, there is a big inflammation which keeps bothering one part or another. I mean, it cannot get better with me playing on it, especially playing last three matches on it. It's just worse."
Kerber and Wozniacki will now meet for a place in the final.