McDonald was one of three players released yesterday after coach Pim Verbeek reduced his 31-man squad to 28 in the wake of a 2-1 friendly win over New Zealand.
The Boro forward failed to find the target in Australia's opening World Cup warm-up game, extending his barren international run to 16 matches in the process.
And while Verbeek showed considerable faith in him during the Asian round of qualifiers, he finally decided to wield the axe just 19 days before Australia play their opening World Cup fixture against Germany in Durban.
The news will come as a bitter blow to McDonald, who had been expected to start all three of the Socceroos' group games.
Instead, Verbeek has opted to go with just two out-andout strikers Josh Kennedy and Nikita Rukavytsya supplemented by former Leeds and Liverpool attacker Harry Kewell.
Scotty is a typical twostriker player, and that's also where he feels happy, said the Australia boss.
But we don't play with two strikers. We play with one striker up top and wingers, so Scotty doesn't fit in this system.
He knows it, and he tried everything.
McDonald's departure leaves two Boro players battling for a place in Australia's final 23-man squad, goalkeeper Brad Jones and defendercum- midfielder Rhys Williams.
Williams was not involved against New Zealand, but Jones was a second-half replacement for Reading goalkeeper Adam Federici as Australia came from behind to record a 2-1 win.
Federici had been at fault for New Zealand's opener, and Jones' strong showing has enhanced his chances of being the number one replacement for established first choice Mark Schwarzer.
Jones was not the only Boro player putting in an effective night's work in Melbourne, as striker Chris Killen scored New Zealand's goal in the 16th minute and also hit a post.
The All Whites striker pulled away to the back post to break the deadlock, and clattered the woodwork with a volley moments later.
Killen, due to become a free agent at the end of next month, is expected to retain his place in New Zealand's starting line up when they play their next warm-up game against Serbia on Saturday.
Chris Killen is a good finisher and, in combination with Shane Smeltz, we have seen what he can do in and around the box, said New Zealand boss Rikki Herbert.
Source: Northern Echo
Source: Northern Echo