Zara Phillips suffered a shattering disappointment today when she was forced to abandon her Olympics dream again following an injury to her eventing horse Toytown.

News of the withdrawal of the world champion, whose profile as a member of the Royal Family going for gold was set to be one of the biggest stories of the Beijing Games, represents a grievous blow for team Great Britain.

The injury to Toytown, the horse on which Phillips won the world championship in Aachen two years ago, occurred during a training session yesterday, believed to be at her Gatcombe Park base. Four years ago, she was in line for selection to the Athens Olympics, only for Toytown to similarly pick up an injury.

Today's crushing blow left the crestfallen Phillips trying to put on a brave face.

"I am very disappointed not to have the opportunity to ride at the Olympics and feel that Toytown deserved his chance to go," she said.

"However, with horses these things happen and we still have a very strong team. I wish them every success."

It was only on Monday when 27-year-old Phillips, attending an Olympic eventing open day at an equestrian centre near Stow-in-the-Wold, told reporters: "The next two months will be very nerve-wracking because the horses can do stupid things and ruin their chance of going out there.

"The horses have to compete before they go out there; you can't wrap them up and put them in a box and leave them."

The British Equestrian Federation refused to reveal details of Toytown's injury, saying that they wanted to respect Phillips's privacy. "It's obviously a huge disappointment and she needs time and space," said a spokeswoman.

Phillips's selection for the Games was made only on the basis that she would be riding Toytown. There was no chance of her being allowed to substitute one of her other horses instead in Hong Kong, the venue for the equestrian events, because none of them is yet at the required Olympic standard. A reserve horse and rider combination will now be brought in.

After some impressive work-outs on Toytown on Monday, Phillips had explained how she was looking forward to competing in the Games 32 years after her mother, the Princess Royal, took part in the Montreal Olympics. Her father, Captain Mark Phillips, a former Olympic gold medallist himself, is also going to Beijing as coach of the United States team.

Losing her as a medal chance is bad enough but losing the glow she casts as a former BBC Sports Personality of the Year and perhaps the biggest name in the Games is even more calamitous for a team which already faces the prospect of Paula Radcliffe withdrawing from the Olympic marathon through injury.