Houston died at the Beverly Hilton hotel Saturday at the age of 48 after a long battle with substance abuse. She had been expected to attend Sunday's prize presentation.
As an autopsy was being conducted on Houston's remains Sunday to determine the cause of her death, Hudson was preparing to take the stage at music industry's biggest awards show, USA Today said.
"It was a big shock when the news hit," Grammy Awards ceremony executive producer Ken Ehrlich told the newspaper. "We're definitely going to do something, but in some ways it's too fresh and too early to do a full-blown tribute."