Left-handed reliever Aaron Loup and utility infielder Andy Burns have been sent to triple-A Buffalo, while right-hander Dustin Antolin has been designated for assignment to make room for Morales on the 40-man roster.
Estrada will take the mound on Friday in the series opener against Seattle. He was placed on the 15-day DL July 6 due to back soreness. The 33-year-old ranks first in the American League in WHIP (0.99), fourth in ERA (2.93) and is holding opponents to a major-league best .173 batting average.
Morales, who signed a one-year deal with Toronto in April, has only appeared in two games for the Blue Jays this season after suffering from shoulder fatigue. The Blue Jays had to either activate or cut Morales by Friday after his 30-day rehab window expired on Thursday.
Loup has struggled in limited use this season, allowing four earned runs in six innings, while Burns is hitless in six at-bats.