They have requested the IRL to postpone the tournament until 2022 to "minimise risk of players contracting COVID-19 and ensure the best outcome for player wellbeing".
The ARL and NZRL made the decision after considering the risk of COVID-19 infection in the United Kingdom, the worsening environment in Australia and the time a majority of NRL players would have to spend away from home under strict biosecurity conditions prior to the World Cup.
ARLC chairman Peter V’landys AM said player wellbeing and safety must come first.
"Not participating in this year’s World Cup is not a decision the Commission has taken lightly, but we must put the best interests of our players and officials first. Protecting them is our absolute priority," he said.
"In the current environment, the risks to the safety, health and wellbeing of the players and officials travelling from Australia to participate in the tournament this year are insurmountable.
"The majority of NRL players are currently living away from home under difficult biosecurity protocols.
"They would then be required to remain under protocols and away from home for the duration of the tournament before again quarantining on return to Australia.
"This is too much to ask our players and officials to do.
"We have again requested the IRL and Rugby League World Cup consider postponing the event until 2022 to enable all players to participate."
NZRL CEO Greg Peters said the decision to withdraw was because the safety and wellbeing of staff and players "cannot be guaranteed to our satisfaction".
"There are stark differences between how the pandemic is being managed in the UK compared to Australasia and recent developments have highlighted how quickly things can change.
"We understand how disappointing this is for fans and those involved, however player and staff safety remains paramount."