"It has come to my attention that Lance has failed to meet certain requirements relating to the first-offender program he was placed in last fall," Badgers coach Bret Bielema said in a statement.
Smith was arrested last July and faced several charges stemming from an incident with his girlfriend. He pleaded guilty to misdemeanor charges of battery and disorderly conduct, and he was prohibited from participating in away games last season.
Smith is suspended from competing and practicing with the team. He remains on the roster and can still use team support services.
The junior had 429 rushing yards and three touchdowns last fall despite playing in just eight games. He was expected to share carries this season with projected starter P.J. Hill and reserves Zach Brown and John Clay.
Adam Rittenberg covers the Big Ten for ESPN.com and can be reached at email@example.com