Suarez sat on the bench throughout Uruguay's 3-1 loss to Costa Rica on Saturday, prompting questions why the talismanic forward was there in the first place.
Tabarez explained Suarez had asked to sit on the bench to feel involved, while the 67-year-old coach insisted the striker would need to improve his fitness considerably to be involved against England on Thursday.
Suarez had surgery on his left knee in the lead-up to Brazil 2014 after injuring his meniscus while training with Uruguay.
"Luis Suarez is no longer injured, because he wouldn't have been a substitute if he was," Tabarez said at his post-match press conference.
"He has gone through the phases that we have foreseen in his recovery and we will have to see if he can find fitness.
"As we said from the beginning, if he meets the challenges, we will see how he can get into the team - and at which point. For us, he is a key player. He has great potential and has a lot to contribute to the team.
"We need him to reach a point where he can play in a match. It was he who demanded to be on the bench, not watching from the stands. It would have been very difficult for him to play though.
"He was a serious doubt, you need to have a certain fitness level - you need to be able to reach the highest standard. There were certain concerns over his fitness and it was very improbable that he would play. We will see about England."
Tabarez also conceded he had been outwitted tactically by Costa Rica coach Jorge Luis Pinto.
Uruguay's boss explained that after Costa Rica moved 2-1 ahead, they had let Uruguay keep the ball in areas that would not hurt the Central Americans and then stunned their higher-ranked opponents late in the match to wrap up the win.
"I don't know what Costa Rica's limit is but today they played well," Tabarez said.
"They were tactically better than us, which reflects well on their coach and players. When they took the lead, they gave us space and let us play where we couldn't do them any harm."
