The 20-year old suffered a hamstring injury in UCD AFC's 1-0 defeat to Waterford on Friday at the Regional Sports Centre and has now been ruled out of the competition.
Reading winger Josh Barrett has been called into the squad to replace Farrugia, who last made an Ireland U-21 appearance against Slovakia in March 2016.
The Oxford-born winger has previously been capped at Under-16, Under-17 and Under-19 level and trained with the squad at Johnstown House Hotel earlier today.
Stephen Kenny's will train in Ireland before flying out to the Toulon Tournament on Saturday, June 1 ahead of their first match against China U-22 on Monday, June 3.
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Republic of Ireland Under-21 winger Neil Farrugia has been ruled out of the 2019 Maurice Revello Toulon Tournament.