The actress dropped out of the project because of a scheduling clash with Ayan Mukerji's Yeh Jawaani Hai Deewani, which co-stars her ex-boyfriend Ranbir Kapoor.
A source told Mumbai Mirror: "Deepika felt that her pairing with Saif [Ali Khan] needs a break after Love Aaj Kal, Aarakshan and Homi Adajania's film - tentatively titled Cocktail.
"When the dates for Race 2 and Ayan's film clashed, she opted for the latter."
They added: "Rumours about Priyanka Chopra replacing Deepika hasn't gone down too well with [producers] the Tauranis. They sat down with Deepika and sorted out all the problems. They even agreed to enhance her remuneration."
Race 2 had already run into difficulties with female lead Sonakshi Sinha dropping out because of prior commitments to the Dabanng sequel.
Padukone recently admitted that she finds promoting a film stressful.
She said: "On a Friday morning, when my movie is releasing, I get really anxious and nervous. If a movie doesn't do well, you do get disappointed because you have put in your best efforts."