Piper, found to have taken cannabis, was also fined £500. His replacement will be reserve wicketkeeper Tony Frost.
The eagerly awaited return from injury of Allan Donald, Warwickshire's South African fast bowler, has come as little consolation for the county most bookmakers tipped at the start of the season to win the title.
Paul Smith, a former team-mate at Warwickshire, recently intimated in a Sunday newpaper article, publicising his own book, that drug-taking went on in county cricket.
Smith, who disclosed he had used cocaine and other drugs during his career, was suspended last month by the England Cricket Board for 22 months after this admission.
The issue of drugs was raised at the League Cricket Conference meeting at Old Trafford last weekend, when the clubs decided to press the ECB for the introduction of more consistent sanctions.
Some delegates were appalled that suspended professional players were permitted to play at club level. Bob Cherry, the LCC chairman, said: ``Any ban should be effective universally.''
It is surprising that cannabis, though illegal, is not on the ECB's list of banned substances. Piper, 27, appears to have been dealt with very leniently, though it is unlikely now that his career will progress beyond the England A stage.
Warwickshire said in a statement: ``Both the board and the club take a serious view of the offence, believing that it is essential for the clean image of the game of cricket to be protected.
``The player has agreed to give the club a signed undertaking that he will not be using the drug in future. The club have also offered to provide counselling to the player.''
Warwickshire said they carried out a drug test on their players on Monday in response to Smith's claims. Every county will now have to step up their own testing.
The fact that Warwickshire have signed Ed Giddins - sacked by Sussex for drug-taking - for next season now looks like an unfortunate coincidence. Giddins was suspended for 19 months by the authorities after tiny traces of cocaine were discovered in a random test last summer. He consistently denied he was a drug-user.
The ECB issued a statement that ``commended'' Warwickshire for their action. Richard Little, a spokesman, said: ``They did consult with us beforehand and Gerard Elias, the chairman of our discipline committee, was also consulted.''
Donald, who has been suffering from a bad back, will be playing his first championship game for a month, two of his three appearances having ended in victory.
Nasser Hussain misses Essex's game against Derbyshire at Southend with tennis elbow. He needed a cortisone injection in London after Tuesday's NatWest Trophy win over Buckinghamshire. He said he expected to be fit for next week's third Test.
Middlesex, the table leaders, have recalled Owais Shah, their England A school-leaver, for the game against Yorkshire at Headingley.