Per Shams Charania of Yahoo Sports, Sefolosha is expected to have surgery to repair his MCL injury.
Marc Stein of the New York Times noted Sefolosha's estimated recovery time is at least six months.
Sefolosha injured his knee during the second quarter of Utah's 99-88 loss to the Charlotte Hornets on Friday.
Injuries have been a problem for Sefolosha recently. He missed 20 games for the Atlanta Hawks last season due, in part, a strained groin.
The Jazz signed Sefolosha to a two-year contract in the offseason. The 33-year-old had the best scoring average (8.2 points per game) and the second-highest field-goal percentage (49.2) of his 12-year NBA career in 38 games this season.
Jazz head coach Quin Snyder will rely on his depth at small forward, including Joe Ingles and Joe Johnson, to replace the lost production from Sefolosha.