"My coach and team always said 'only go to tournaments when you are prepared to go all the way'".
Djokovic, ranked 12th in the world, will play in the Kooyong Classic in Melbourne and then at the Tie Break Tens tournament at Melbourne Park.
Williams played in an exhibition tournament last weekend in Abu Dhabi and indicated after her loss to French Open champion Jelena Ostapenko that she might not travel to Melbourne.
Novak Djokovic has added the Kooyong Classic to his schedule as the former world number one attempts to prove his fitness ahead of the Australian Open.
With his participation at the Australian Open in risk, the Serb confirmed on Facebook and on his website what Michal Samulski, member of International Tennis Writers Association, had written on Twitter. I can compete - but I don't want to just compete, I want to do far better than that and to do so, I will need a little more time.
The 23-time grand slam champion joins the growing list of absentees for the year's opening major, which already includes five-time runner-up Andy Murray and former world number four Kei Nishikori, with doubts also over star duo Novak Djokovic and Rafael Nadal.
Tournament director Craig Tiley called Williams' efforts to try and be ready for a title defence at the Australian Open "Herculean" and said she transcended the sport.
"He wrote in the caption: "#australianopen on my way".
"It was never going to be good enough for her to just compete, she wants to give herself the best chance to win".
It will be the first time Williams, who has won in Melbourne seven times, has not played Down Under since 2011.
"I've been in constant contact with Serena and her team and know this is why she has pushed it and pushed it until the eleventh hour to make her final decision".