The seven had been excluded because results of the tests were above "IOC blood index" levels - though not necessarily officially positive for a banned substance - rowing's governing body Fisa said.
The International Olympic Committee welcomed the move, which was implemented by China's Olympic chiefs after seven rowers failed drug tests.
"I'm very pleased, I'm very happy," said IOC president Juan Antonio Samaranch. "This is very good news. It shows the new system for detecting doping substances will work very well."
The IOC recently approved blood testing for the first time, in the hope of catching athletes using the endurance-enhancing drug EPO.
"This is a warning to all athletes who wish to come to the games with drugs in their system - stay at home," she said.
Chinese authorities who have been on a campaign to improve their sporting image to better their chances of winning the 2008 Olympics for Beijing.
"These athletes in my opinion were being cowards and were using things they shouldn't have been using," DrFrantz said. "I've said for a long time any athlete who is using drugs who cannot compete with his or her own ability should stay at home.
"Do not come to the Games if you are not coming clean."
Rowers implicated
Rowing's world body said on its official website that the Chinese Olympic Committee had dropped seven of the 17 rowers for the Games it had announced just 10 days ago.
The seven had been excluded because results of the tests were above "IOC blood index" levels - though not necessarily officially positive for a banned substance - rowing's governing body Fisa said.
Liu Jianyong, secretary general of the Chinese Rowing Association, said the rowers had withdrawn to protect their health and uphold the fairness of the Olympic Games.
"The Chinese have been testing rowers for EPO and from the results a total of seven - men and women - were above the blood index level and the Chinese decided not to send the athletes to the Games," IOC medical officer Patrick Schamasch said in Sydney.
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