The 26-year-old, heavily linked with a move to Manchester City during the latter stages of the transfer window, has reportedly not turned up for training since the move to City collapsed and his future remains unclear.
Puel has now confirmed he will not call upon the Algeria international for this weekend but hopes he will feature for Leicester in the near future.
“As a club, we took this decision for the good of Leicester,” said Puel. “I think it’s the best decision for the club after the position with Riyad.
“I will assess Riyad when he clears his head. The business [side] of the transfer window is difficult for us to manage but I think it is time now to move on and keep our focus.
“I hope Riyad can clear his head and come back with us because he’s a valuable player for us.”
Meanwhile, Foxes captain Wes Morgan is also out, after the highly-experienced centre-back suffered a hamstring injury in New Year’s Day’s win over Huddersfield Town and is still not ready to return.
Uwe Rosler was sacked by Fleetwood following a 3-0 reverse at Doncaster which condemned Town to a seventh straight defeat in all competitions.
Cambridge interim head coach Joe Dunne was pleased with how his side adapted to beat Grimsby 3-1.
Southend manager Chris Powell led the applause for Jason Demetriou after the right-back scored twice in the 3-1 win against Portsmouth at Roots Hall.
Morecambe boss Jim Bentley was the happier manager after Gregg Wylde's 90th-minute strike earned his side a point in their 1-1 draw with Forest Green.
Manager Gareth Ainsworth described Wycombe's 2-0 win at Cheltenham as a thoroughly professional performance.
Skipper Richard Wood scored the winner just before half time as in-form Rotherham pulled off a 1-0 victory at League One leaders Shrewsbury.