He suffered the injury during drills this past week, and will undergo surgery late next week. The recovery time can take up to a year.
"Our main concern is getting Tyree healthy," Rutgers coach Mike Rice said. "He will remain involved in team activities."
Graham, who has two years of eligibility remaining, was supposed to be a leader on a young team next season.
He missed last season after undergoing surgery to repair a torn anterior cruciate ligament in his knee, an injury he played with during his final season in junior college before transferring to Rutgers last summer.
If Graham misses the entire season, he would be eligible for a sixth year. However, a player cannot petition the NCAA for a sixth year until his fifth year is completed.