The 23-year-old Russian was unable to secure a deal with any of the WRC teams due to budget issues.
He was already missing from the entry list for next month's season-opener in Monte Carlo, and on Tuesday it was officially announced that he would only participate in "selected events" in 2014.
Mikhail Lepekhov, head of the ALM Rally Team organisation that has supported Novikov's career, said: "Unfortunately, Evgeny most probably has to skip the 2014 WRC season because of a lack of funding.
"We spoke with different teams but couldn't come to terms. It is still possible for Evgeny to start at selected events, but a proper programme for him is out of our reach."
Novikov made his WRC debut in 2007 when 17 years old.
He drove for Citroen's Junior team in 2009, then announced his retirement from the sport, only to return in 2011.
Novikov was the first Russian to take a WRC stage win and to finish on the podium, taking second in Portugal and Italy in 2012.
He had a difficult 2013 season with M-Sport, ending up seventh in the championship.
M-Sport has already announced Mikko Hirvonen, Elfyn Evans and Robert Kubica as its 2014 drivers.