The 22-year-old will miss out on Brazil after picking up an ankle injury in the 1-0 win at Stoke which will keep him out of action for up to 10 weeks.
Townsend only came on as a late substitute at the Britannia Stadium, but he left the ground wearing a protective boot following a heavy challenge from Erik Pieters.
The winger played a key role in securing England's qualification, scoring on his debut against Montenegro and starring in the crucial win over Poland at Wembley.
Sherwood admitted that there was no intent in the tackle which injured Townsend, but says that he would have backed him to make the World Cup.
"I don't think there was any malice in the challenge, I think Andros was trying to take on, as he does, his full-back and he got late with a tackle," he told Sky Sports News.
"But I don't think there was anything bad in the tackle - he caught him nice and hard, but fair - and it's one of those things.
"We're in this sport and you're going to get injuries from time to time, but obviously it's a hugely disappointing one for Andros because I'm sure that he would have been on that plane to go to Brazil in Roy's squad because he is largely the reason why all the rest of the players are going there.
Asked if Townsend would have made the England squad, Sherwood said: "I think he would. He's a maverick of a player is Andros Townsend.
"I always says to people that Andros can run the ball into the full-back 10 times, it doesn't faze him. On the 11th time, he runs past him, he squares it or scores a goal himself.
"He's a match-winner. He's not fazed at all if things are not going well for him.
"He's single-minded and I'm sure that he's so strong in his mind that he's going to get over this setback and come back strong again. There's plenty more World Cups for Andros Townsend.
"He gives everything in training to make himself better, to try and improve himself. And he will.
"This is a major setback for Andros and he's bitterly disappointed but he has nothing to worry about. He's played a huge part in getting the other 20-odd players on that plane and Roy himself.
"Andros knows that and he'll take that as a positive. On a negative side, he's got to wait another four years for a World Cup."