The 20-year-old, who sustained the injury in the Super Rugby playoffs, has been replaced in the squad for the Rugby Championship by the uncapped David Havili.
"After the camp Jordie Barrett got some scans on his shoulder that he hurt in the semi-final and it looks like that is going to need an operation," assistant coach Ian Foster told reporters in Auckland on Thursday.
"If it is an operation, (that's) going to knock him out for probably the rest of the year.
"So whilst it is disappointing for him, he's probably already had a big year. I guess he's too young of an athlete to play through anything like this."
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
Barrett made his test debut against Samoa in June before he earned his first start in the third test against the British and Irish Lions, where he scored a try and set up another for Ngani Laumape.
The Wellington Hurricanes utility was an 'apprentice' player on the end of season tour to Europe last year before he was named in Steve Hansen's squad for the Lions tour, joining older brothers Beauden and Scott.
He had been expected to push for the starting fullback role after the opening two Rugby Championship games against Australia when first-choice Ben Smith starts his sabbatical.
The All Blacks open their title defence against the Wallabies in Sydney on Aug. 19.
(Reporting by Greg Stutchbury; Editing by Ian Ransom)
