England and Wales Cricket Board (ECB) spokesperson said.
The Cricket Regulator opened an investigation after a video clip emerged showing the fast bowler being detained by police on a night out in Derby, plunging the England and Wales Cricket Board (EC) into yet another alcohol-related drama.
Carse was due to link up with his England team-mates in London on Monday evening ahead of this weeks second Test at Lord's, but the 31-year-old was stood down after the independent disciplinary body confirmed it would be looking into the episode.
A statement from the ECB read: "Following a referral from the ECB, the Cricket Regulator have confirmed that they will investigate events on Saturday night in Derby. Brydon Carse will no longer be available for selection for the Second Men's Rothesay Test Match while this investigation is ongoing and the full facts are obtained."
Sonny Baker, who made his debut at Lord's earlier this summer when Ben Stokes and Gus Atkinson were left out against New Zealand for breaking a curfew, has been added to the squad as bowling cover.
Carse was not on England duty at the time of the alleged incident after being an unused member of the squad for the first Test which England won comfortably at Headingley. He had been playing in a domestic county match at Derby, won by Durham earlier on Saturday.
The investigation comes five days after England's returning Test captain Joe Root spoke of the players needing to be "really good role models and human beings" after a series of incidents in the last year prompting accusations of a drinking culture.
Besides the curfew breach vice-captain Harry Brook was fined Stg 30,000 ($A57,000) following an altercation with a bouncer in New Zealand and there were reports of drinking during a mid-Ashes trip to Noosa.
Stokes eventually announced his retirement from international cricket while Brendon McCullum was sacked as Test coach.
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