The Burnley striker was not named as part of the 24-man squad named by O'Neill on Monday for the World Cup qualifier against Azerbaijan on November 14. His absence followed a withdrawal from the previous squad due to "ongoing fitness issues" and Paterson is not now available for duty until further notice.
The 25-year-old hinted before pulling out of the 1-1 draw against Portugal that he may have to shelve his international ambitions in a bid to establish full fitness at club level. O'Neill said: "The conversation we had with Martin last time was that he was not available and that he would come back to me when he was."
He added: "I would like Martin to be available and I've selected him every time he has been. I still think he could be a very important player for us but he is wary because of his injury problems and I understand his reasons. I appreciate it from a professional point of view. I have to respect that but I want this squad as strong as possible and I would like to have him."
Nottingham Forest goalkeeper Lee Camp is another player to have made himself ineligible in recent months.
He left the squad citing "personal reasons" after being overlooked for Roy Carroll in the Group F opener against Russia and has yet to return. Michael McGovern and Alan Mannus again provide the back-up for Carroll this time.
O'Neill will also face some selection dilemmas after a handful of squad players helped Northern Ireland tame the might of Cristiano Ronaldo's Portugal last time out.
Chris Brunt, Shane Ferguson, Jamie Ward, Grant McCann, Paddy McCourt (all injured) and Gareth McAuley (suspended) missed the trip to Porto but are back in the fold for the visit of Azerbaijan. In their absence the likes of Corry Evans, Ryan McGivern, Oliver Norwood and goalscorer Niall McGinn all enjoyed their finest hours in international football.
"I think it feels like we have some more established players now, and you always hope for that," O'Neill said.
"Look at the experiences gained by players like Niall, Corry, Ollie and Ryan, that was probably their first big experience of that kind of game and coming away from an arena like that with a result. There are always going to be decisions to make about who starts and who doesn't start."
Source: PA
Source: PA