Australia's star batsman Steve Smith has been ruled out of the third Ashes Test beginning on Thursday after suffering concussion, Cricket Australia announced on Tuesday.

The 30-year-old — who has scored two centuries and 92 in his three innings in the first two Tests — was felled by a Jofra Archer bouncer on Saturday in the first innings of the second Test at Lord's.

"Steve Smith has been ruled out of the third Ashes Test at Headingley, with coach Justin Langer confirming the news after the batsman sat out Australia's training session on Tuesday," Cricket Australia announced on their website.

The team doctor Richard Saw had the final say on whether Smith played or not and he was seen speaking with him during team training on Tuesday. According to the website, vice-captain Pat Cummins patted Smith on the shoulder and coach Justin Langer wrapped his arm round the former captain as the rest of the squad trained without him.

Smith, whose two centuries in the first Test were pivotal in Australia taking a 1-0 lead, returned to bat on Saturday despite the blow to the side of the head that felled him. He added 12 runs before being out.

However, he was unable to play on the fifth and final day on Sunday as he awoke feeling "groggy". Australia held on to draw the Test with his concussion substitute Marnus Labuschagne playing a key innings.

The Ashes series is the first being played under the International Cricket Council's new concussion substitute regulations, as part of the inaugural World Test Championship.

The regulations allow players who have suffered head or neck injuries to be replaced fully by a substitute, who was previously restricted to fielding alone.

During Saturday's play, Smith was wearing a helmet without the additional stem guard neck protection introduced following the death of his former Australia team-mate Phillip Hughes who was hit by a bouncer in a domestic Sheffield Shield match in Sydney in 2014.

Australia, bidding for their first Ashes campaign triumph on English soil in 18 years, lead the five-match series 1-0 after a 251-run win at Edgbaston last week.

In that match, Smith marked his first Test since completing a 12-month ban for his role in a ball-tampering scandal in South Africa with superb innings of 144 and 142.