Lugano completed 90 minutes as Oscar Tabarez's team went down to a shock 3-1 defeat at the hands of Costa Rica in their Group D opener last Saturday.
But the 33-year-old defender, who was released by West Brom at the end of last season, will not face Roy Hodgson's men due to soreness in his left knee.
A statement on the Uruguay FA's official website confirmed Lugano's absence, but went on to explain the player is not expected to require treatment following the results of an MRI scan.
Uruguay face England, who also lost their first game to Italy, on Thursday at the Arena Corinthians and expect to be boosted by the return of Luis Suarez following the star forward's recovery from knee surgery.
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