Wallace, who came out of retirement to play for the Knicks this season, has been out of the lineup since Dec. 13 with the foot injury.
The team said a recent exam of Wallace's foot revealed a fractured fifth metatarsal bone. He is scheduled to undergo surgery this week.
The 38-year-old, four-time all-star averaged 7.2 points and 4.2 rebounds per game over 20 contests this season before sustaining the injury.
Over 1,108 games in his 15-season career, Wallace has compiled averages of 14.4 points, 6.7 rebounds, 1.8 assists and 1.3 blocks while playing for Washington, Portland, Atlanta, Detroit, Boston and New York.