Masterson, who was activated from the disabled list on Tuesday and temporarily placed in the bullpen, will start Sunday's game at Tropicana Field against the Rays.
After acquiring Kelly from the Cardinals along with Allen Craig for John Lackey last July 31, the Red Sox hoped they had two building blocks. Instead, Kelly will now join Craig, who struggled mightily earlier this season, at Pawtucket.
Though Kelly's velocity has often reached the upper 90s, his command has been shaky.
"The options would have been to put him in the bullpen or to send him down to start," said Red Sox manager John Farrell.