Nadal pulled out of the match due to a knee injury he picked up in the previous match, when he had to call for a trainer a couple of times.
The world no.2 Spaniard has suffered from knee problems in the past and decided not to risk any further injuries.
“We are disappointed that Rafa has been forced to withdraw from the tournament but the health of the players always needs to be the number one priority,” said the tournament director Adam Barrett.
This is the second walkover for Murray at this years tournament as Raonic pulled out of their third round match due to an injury.
In the final, Murray will play either the world no.1 and defending champion Djokovic of Serbia or the Argentine Juan Monaco.