Greg Page, 34, said in a statement that the disorder orthostatic intolerance, which causes dizziness, fatigue and nausea, had left him debilitated.
He said it was not life-threatening but "it means I'll no longer be able to sing and dance as I want to".
The condition is related to blood pressure and has affected Page's balance, breathing and co-ordination at unpredictable times and with varying severity, according to a statement on the band's website.
Page withdrew from the group's US tour in June after suffering from fainting spells and lethargy.
The Wiggles concerts are exhausting to watch, so much energy radiates from the stage. Imagine an arena filled with clapping, wriggling tots singing songs at the top of their lungs.
The Wiggles were Australia's top-earning entertainers last year, ahead of AC/DC and Nicole Kidman.
We'll miss ye Greg, yellow Wiggle, but I'll be glad to skip the creepy puppet version of ya. Havenu Shalom Alachem.