"I think this is an extremely strong message and a very severe punishment for a player that may potentially be the most-skilled player on our whole roster," Kiffin said. "Hopefully that message not only helps him but helps our team and especially our freshman class."
Kiffin informed Baxter of his decision Wednesday morning and said the freshman would continue to participate in practices and be back on the field for USC's home opener Sept. 11 against Virginia.
Kiffin would not specify what team rules Baxter had broken, and the freshman running back was not allowed to speak to reporters after taking part in Wednesday's practice.
On Tuesday, Baxter and a teammate, freshman wide receiver Markeith Ambles, spent the morning practice running along the sideline as punishment for what Kiffin at the time said was being "late for something."
Baxter, however, was forced to continue with the drills, which included rolling on the turf, during evening practice while Ambles was able to return to practice.
"There are just things that you have your opinion on of whether people make mistakes, whether people make choices on purpose," Kiffin said Tuesday. "I felt Markeith it was more of a mistake and I felt Dillon's was more severe."
Kiffin said he's still trying to decide whether or not Baxter will make the trip with the team to Hawaii.
"I don't know that. I'm still trying to figure that out," Kiffin said. "There are reasons for him to go, I think, so that he sees what he misses and has that feeling and it hurts more. But it's also a Thursday game and with the travel schedule he'd be missing school so I have to figure that out."
Baxter, who enrolled at USC in January after graduating a semester early from Mission Bay High School in San Diego, had a number of highlight-reel plays during spring practice and was being counted on to contribute at tailback and as a returner this season.
"He wasn't happy by any means but he has two choices," Kiffin said. "This is adversity right now for him and he can deal with it two ways, like I told him. He can sit around and pout and think that he's being picked on, used as an example and he can stay over there and we can move on without him or he can take this and move on from here and work to get ready for the Virginia game."
Arash Markazi is a columnist and reporter for ESPNLosAngeles.com. Follow him on Twitter at http://twitter.com/ArashMarkazi.