The testing period, which was set to be held from May 12 to 22, has been canned in hopes of assisting school leaders, teachers and support staff to focus on the well-being of students and continuity of education including potential online learning.
The decision was made on the advice of the chief health and medical officers who stated "pre-emptive closure of schools are not proportionate or effective as a public health intervention to prevent community transmission of COVID-19 at this time."
"The decision to cancel NAPLAN for 2020 is the right one," Minister for Education James Merlino said.
"These are unprecedented times and our school communities need to focus on the additional challenge of preparing for remote learning."
While this decision means this is one less testing tool to help schools, the ministers want to thank everyone involved for their efforts.
"I want to acknowledge the exceptional contribution from our teachers, support staff and principals at all schools during these challenging times," he said.
"They can be assured that we are acting on the very best medical advice."
The impact of responses to the coronavirus may affect the delivery of NAPLAN testing, including the operation of centralised marking centres and the implications for nationally comparable data if an insufficient number of students were available to take the test.
The decision not to proceed with NAPLAN also means the scheduled testing of the NAPLAN online platform, known as the Co-ordinated Practice test (CPT) will not proceed either.
Education departments and systems will continue to closely monitor health advice and work with schools to ensure appropriate support for students and staff as the response to COVID-19 develops.