Balotelli came off the bench in the second half of Liverpool's FA Cup quarter-final tie against Blackburn at Anfield but his introduction was not enough to prevent a replay.
The Italy international has now gone five competitive matches without scoring, while the 24-year-old has only netted four goals in all competitions since joining Liverpool in a £16 million transfer from Milan.
And Lawrenson, who helped Liverpool to five league titles and European Cup success during his seven-year spell, believes Balotelli is a waste of space at Anfield.
"Forget about Mario Balotelli. He is an absolute waste of time. He shouldn't be anywhere near this team," Lawrenson told BBC Radio 5 Live.
"I can see why Brendan Rodgers threw him on today as he might just create something, but 99 times out of 100 he will let you down."
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