It's the third time in six weeks the former No. 1 player in the world pulled out of a tournament.
Davenport was scheduled to play eighth-seeded Francesca Schiavone in a first-round match Tuesday evening, but dropped out after warming up Monday. A three-time winner of the event, Davenport was attempting to play for the first time since pulling out of her second-round match at Wimbledon.
The 32-year-old Davenport also dropped out of the Eastbourne tournament on June 16, citing the same injury.
"The Bank of the West has been one of my favorite tournaments to play throughout my career,'' Davenport said in a statement. "Unfortunately, my knee has not healed sufficiently since Wimbledon to allow me to compete.''
A three-time Grand Slam champion, Davenport previously won the Bank of the West Classic in 1998, '99 and 2004.
Qualifier Aleksandra Wozniak of Canada replaced Davenport in the draw and will play Schiavone.
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