Halladay said Friday that the forearm has bothered him off and on all season. He missed a start in April because and left his last start against New York in the fourth inning.
"I realized this was the best and smartest thing to do," said Halladay, who had just two scheduled starts left.
The 2003 AL Cy Young winner hasn't pitched a complete season in three years because of injuries. He went 16-5 with a 3.19 ERA in 220 innings.
Halladay said it's the same soreness he felt in April.
"There's times where it never really 100 percent goes away," Halladay said. "There were times in the year where it would show up. I would say probably the last couple of starts here. It's something that is tolerable. I felt like we were starting to push it a little bit."
An MRI showed no ligament or structural damage.
Halladay called it a "wear and tear" injury.
After New York's Bernie Williams fouled off a pitch Wednesday, manager John Gibbons, pitching coach Brad Arnsberg and trainer George Poulis went to mound to see Halladay. Halladay didn't even attempt one warmup pitch before leaving the field.
He said he felt it early in the game and continued to pitch with it.
"We're going to let him get healthy," Gibbons said.
Halladay missed most of second half of the 2004 season with shoulder problems and the entire second half of last year with a broken left leg.
He signed a $40 million, three-year contract extension in the spring, a deal that could keep him with the Blue Jays through the 2010 season.