One of the most notable omissions from the squad is Arsenal's Theo Walcott - who has scored eight Premier League goals this season - and Southgate admits it was a hard call to leave him out.
But he has been dropped by Gareth Southgate for games against Germany and Lithuania despite the absence of key goal sources such as Wayne Rooney, Harry Kane and Daniel Sturridge.
Defoe is the top English scorer in the Premier League after Kane, who has 19 goals to his credit.
England face Germany in a friendly in Dortmund on March 22 before welcoming Lithuania to Wembley for a World Cup qualifier four days later.
"Generally we've tried to pick players who are playing regularly for the clubs", Southgate said of Shaw's selection.
The Manchester United talisman is in contention for a place against Middlesbrough at the weekend but for the first time has been told that he is not part of an global squad when technically fit to play.
"I didn't want to just look at his age and think he's finished with England".
The Arsenal forward has scored more goals than anyone in the current England squad which begs the question - why has Southgate overlooked him?
The five-year-old was diagnosed with neuroblastoma in January 2013 and has another round of treatment scheduled in less than two weeks.
It has been more than three years since Defoe has featured in the England squad, but he has been recalled and Gareth Southgate says he could not ignore his form.
Southgate also handed call-ups to uncapped pair James Ward-Prowse and Nathan Redmond, but confirmed that the Southampton duo will return to Under-21 level for the summer.
Southgate has explained his reasoning for snubbing Walcott and Welbeck. "He's a nice guy, someone who I played against, so we had a little laugh about that. It's great to see him now back in the fold".