It is a cruel blow for the talented striker, who came on as a substitute for two-goal hero Bruce Djite at Suncorp Stadium last night.
He was injured only two minutes later and had to be replaced by Bruce Kamau, and Adelaide United today confirmed the ACL rupture.
Babalj will undergo surgery next week and begin a long stint of rehabilitation as he looks to get his promising career back on track.
The 23-year-old burst onto the scene at Melbourne Heart in 2010, and earned a move overseas to Red Star Belgrade.
He returned to Heart before trying his luck overseas again, this time with AZ Alkmaar. He was loaned to PEC Zwolle and then to Adelaide, where he became Guillermo Amor's first signing a coach.
A persistent foot injury kept him Babalj out for longer than expected - his comeback was derailed late last year when it flared up again and he now faces a long road to recovery.