Duquemin, 25, holds the games records for both the shot put and the discus, taking gold in both disciplines on home turf at the 2015 event.
But the Gotland Games clashes with the British Championships, which doubles-up as World Championship trials.
"I've got to put myself first," he told BBC Radio Jersey.
"The main priority and goal is the World Championships and I have to do everything in my power to make sure I put myself in the best situation to qualify for that.
"Just recently the dates have come out and unfortunately it doesn't look like I'm going to be able to fit in the Island Games.
"I was trying to find a way to work it out, looking at dates and seeing if I could maybe fly in on the day to Gotland to compete and then fly back."
Jersey's top-ranked tennis player Scott Clayton, international archer Lucy O'Sullivan and cycling gold-medallist Kim Ashton are amongst the other competitors to already reveal they will miss Gotland.
The biennial Games will run from 24-30 June 2017, while the British Athletics Team Trials are set for Birmingham between 30 June and 2 July.
Athlete Zane Duquemin is the latest leading Jersey sportsperson to confirm he will not compete at the 2017 Island Games in Gotland.