Lakers coached Mike Brown announced the decision before tipoff.
Nash was hurt in the first half of the Lakers' loss at Portland on Wednesday night after colliding with rookie Damian Lillard. Nash attempted to play in the second half, but couldn't move properly.
Just three games into his three-year contract with the Lakers, the two-time MVP is already sitting out. Brown doesn't know whether Nash will play in Sunday's home game against Detroit.
Veteran Steve Blake is expected to start in Nash's place.
Nash missed practice Thursday and didn't attend his MLS team's playoff game while resting the injury. He is a part-owner of the Vancouver Whitecaps.