Walcott ruptured the anterior cruciate ligament in his left knee as he made a tackle toward the end of Arsenal's 2-0 win over Tottenham in the FA Cup on Saturday.
Theo Walcott will have surgery in London in the near future and is expected to be out for at least six months,'' Arsenal said in a statement, therefore missing the remainder of the season and the World Cup in Brazil in the summer.''
It keeps up Walcott's unfortunate luck at World Cups _ he was a surprise selection for the 2006 tournament in Germany as a 17-year-old but wasn't used, before being left out of the squad in 2010.
He would have been a guaranteed pick by England coach Roy Hodgson for this summer's tournament, likely competing with Andros Townsend for the right-wing berth.
Walcott had been in brilliant form for Arsenal F.C. since returning in November after two months out with an abdominal injury, scoring five goals in his last five league games to help his team stay top of the standings heading into 2014. Arsenal leads Manchester City by a point after 20 games.
The injury to Walcott deprives Arsene Wenger's side of one of its best goal threats and a back-up to leading striker Olivier Giroud, who is currently out injured.
With Nicklas Bendtner also out, possibly for a month, it leaves Wenger with few options up front. Currently, Lukas Podolski is the only fit forward in the squad and he usually plays on the left wing.
It may prompt Wenger to make a move in the January transfer market, with Arsenal facing a busy second half of the season after reaching the last 16 of the Champions League, where it will play Bayern Munich.
Arsenal F.C. hasn't won a trophy since 2005.
Earlier Monday, Walcott escaped punishment for taunting Tottenham F.C. fans while he was being taken off on a stretcher after sustaining the injury.
As medics carried him in front of visiting supporters, Walcott signaled the 2-0 score with his fingers, prompting Tottenham supporters to pelt him with coins and bottles.
The Football Association said it has contacted Walcott ``and reminded him of his responsibilities regarding a `scoreline' gesture he made,'' but will not be taking any further disciplinary action.
The governing body also said it has contacted the north London clubs to seek their observations in relation to objects being thrown from both sets of fans during the game.