The injury will mean Arzani will miss the Socceroos’ AFC Asian Cup title defence in January, as well as the remainder of the Scottish Premiership season.
Arzani suffered the injury during his debut match for Celtic last Thursday (AEDT), coming on as a substitute during a 5-0 league win against Dundee.
The former Melbourne City star fell awkwardly and was stretchered off the field after only 20 minutes.
Initial fears of a torn ACL were confirmed when Arzani visited world-renowned knee surgeon Ramon Cugat in Barcelona.
Arzani announced his diagnosis in an emotional post on Instagram.
"I received the bad news today that I will indeed need an ACL Op ruling me out until next season," Arzani said.
"Apologies to the Celtic fans for my 20 minute cameo. This is however the beginning of my journey and I promise to be back better than ever. Day 1 road to recovery starts now.
"Thank you to everyone who has taken the time out of their day to show support and love.
"I’m trying my best to reply to everyone but please understand this is also a very tough time for me."
The injury is one of the first major roadblocks for Arzani, whose breakout 2017-18 season with Melbourne City in the A-League helped earn him selection in the Socceroos squad for the 2018 FIFA World Cup in Russia.
Impressive cameo performances off the bench for the Socceroos allowed the AIS graduate's star to shine even brighter, with Manchester City signing him in July, before sending him on loan to Scottish champions Celtic.
While his loan deal with the Hoops is for two years, Arzani's future at Celtic is now uncertain with the winger set for months of recovery and rehabilitation.
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