After being named sub for the qualifying and preliminary finals, small forward Jack Ginnivan will come into the starting lineup against Brisbane on Saturday at the MCG.
Brisbane have named an unchanged lineup as expected, with defender Jack Payne staying out of the side and Jarryd Lyons named their sub.
The Magpies confirmed Lipinski's demotion ahead of the teams being named on Thursday evening, with Ginnivan then confirmed as his replacement.
Ginnivan and John Noble were left out of Collingwood's 22 for the qualifying final against Melbourne and Noble remains an emergency.
As coach Craig McRae revealed on Wednesday, tall utility Billy Frampton will come into the side to replace injured forward Dan McStay.
Temperatures in the high 20s are forecast for Saturday and Collingwood are banking on Lipinski's fresh legs having an impact later in the game.
"Pat's elite running ability will no doubt inject energy into the game and we look forward to seeing him make an impact on Saturday," Magpies football boss Graham Wright said in a statement.
Payne was at long odds to force his way back into Brisbane's team after missing their preliminary final win over Carlton because of an ankle injury.
The Lions will persist with fellow tall backman Darcy Gardiner, who played well on Coleman Medallist Charlie Curnow in Payne's absence.
While the Lions remain without Payne, the Magpies have suffered two well-documented selection blows ahead of the grand final.
McStay was ruled out because of the knee injury he suffered in their preliminary final win over GWS, while midfielder Taylor Adams had a setback at Tuesday training in his recovery from a hamstring injury, meaning he also remains out of their side.
Adams' season ending prematurely for a second consecutive year because of injury has been tough for the Magpies.
"It's really challenging," defender Jeremy Howe told the Nine Network.
"He's one of our spiritual leaders the way that he acts on-field.
"Especially at this time of year, he seems to thrive when the games get really hard and ultra-competitive. That's generally what he does best.
"... It's really hard to see him get his body through the whole season and unfortunately just not quite be able to finish it off for the last game of the year."
Adams was replaced for the preliminary final by Nick Daicos, who returned successfully after seven weeks out with a knee fracture.
Howe added Frampton had "put a mountain of work in" to prepare for his shot at his first final.
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