The 6-foot-11 Hilario, who goes by his first name, was hurt in the first quarter of Tuesday night's season-opener against reigning NBA champion San Antonio. An MRI Wednesday revealed the extent of his injury.
Nene banged knees with the Spurs' Tim Duncan on a baseline drive. A future date for surgery has not yet been set.
Hilario appeared in 213 games for the Nuggets, averaging 10.7 points and 6.2 rebounds per game. In 55 games last season, he had 9.6 points and 5.9 rebounds per contest.
Denver has moved Hilario to the inactive list and transferred forward Linas Kleiza to the active list.