The teenager became the youngest British woman to make it to the second week at SW19 in the open era with a 6-3 7-5 win over world number 45 Sorana Cirstea on Saturday.
The 18-year-old became an overnight sensation and there were high hopes she could claim another win against Australia’s Ajla Tomljanovi.
But Raducanu was visibly struggling to breathe as she went a set down against Tomljanovi.
After consulting with the trainer and doctor, she took a medical timeout where it was deemed she could not continue.
ITV News Reporter Martha Fairlie explains it's still unclear why Emma Raducanu has withdrawn from the tournament
Raducanu’s elevated profile prompted a change to the usual schedule, with this match put third on Court One instead of second, which is the normal protocol ahead of the quarter-finals on Tuesday.
It was 8pm by the time the contest began under the roof, with an expectant crowd ready to cheer on the new home hero star.
Raducanu looked a little tight to start with but saved a break point in her first service game and settled into the match.
Tomljanovic saved a break point at 3-3 as Raducanu began to pummel the sort of returns she produced against Sorana Cirstea, and she held for 4-4 with back-to-back aces.
Raducanu’s return was once again showing itself to be world class, although it was a mishit return that she thought had given her a break for 5-4 only for Tomljanovic to challenge and be proved correct.
The Australian, who was playing at an extremely high level, saved another break point and it was Raducanu who proved unable to hold onto her serve in the next game, a forehand over the baseline giving Tomljanovic the set.
Raducanu had looked to be battling to recover after a couple of long points and during the second game of the second set she went to the umpire to request the trainer.
Tomljanovic later took to Instagram to congratulate Raducanu and wish her "all the best after tonight", adding: "I know it feels heartbreaking now but I have no doubt you will come back stronger and better".
Raducanu, who is ranked 338th in the world and was handed a wild card, put her tennis career on hold during the coronavirus pandemic in order to concentrate on her A-Levels.
She was born in Toronto in 2002 to a Chinese mother and Romanian father and the family moved over to England when she was two.
From the age of nine to when she was 16, Raducanu played at Bromley Tennis club, before moving on to train at the National Tennis Centre in Roehampton, south-west London.
Prime Minister Boris Johnson was among those expressing support for Raducanu online and wishing her luck ahead of the game.
He tweeted: "Congratulations @EmmaRaducanu for reaching the second week at @Wimbledon and for making Championship history.
"Good luck in your match today. The country is behind you."
The teenager recently told the Evening Standard newspaper she would choose getting to the next stage of the world-famous tennis tournament over getting A-star grades in her A-levels.