Schumacher was initially tipped to join Alpine after Esteban Ocon announced his exit from the team, however they opted for the experience of their reserve driver Jack Doohan instead.
The German was thrown a lifeline, after Williams axed Logan Sargeant midway through the season, with hopes he could join the team until the arrival of Carlos Sainz next season.
However, Schumacher was once again snubbed as Williams decided to promote their junior driver Franco Colapinto for the rest of the season.
Schumacher is currently a reserve driver for Mercedes but there is no chance at a race seat there after the news that was announced on Saturday at the Italian Grand Prix.
The Brackley-based outfit promoted their junior driverKimi Antonelli, who starred in his first F1 session during FP1 at Monza.
As an F1 return seems further away for Schumacher, he will have to be content continuing to test for Mercedes for now.
In a recent interview with Sky Germany, former racing driverRalf Schumacher asked his nephew what the atmosphere was like at the team currently.
The 25-year-old revealed that he had tested for Mercedes before the Italian GP as he continues to perform his duties as a reserve driver whilst looking for a permanent F1 seat.
“Very good. I just came back from an overnight sim. I flew to Brackley yesterday afternoon,” Schumacher said. “It was a long night but in the end, I think we found some good results.
“Hopefully it will show on the track today. Unfortunately the track is wet now so it doesn’t really help now but let's see how qualifying goes.”
The Mercedes pace looked competitive at Monza until qualifying, when Lewis Hamilton could only manage to set a time good enough for P6.
His team-mate George Russell faired better starting from P3 but could only finish in seventh place in Sunday's race.
With Antonelli and Russell confirmed for Mercedes, Schumacher will have to look elsewhere with time running out to secure at seat on next year's grid.