The 24-year-old was originally included in the senior squad to tour Australasia after the suspension of Bath's Danny Grewcock, but now faces an agonising few months on the sidelines after exploratory work on his injury.
Palmer had impressed in the England 'A' ranks previously, and sustained his injury on his Test debut against the Eagles, as England went on to lift the inaugural Churchill Cup.
The Leeds star would have been a borderline case for making the 30-man World Cup party, with Martin Johnson and Ben Kay the likely starters, while Danny Grewcock and Steve Borthwick may well be the two back-ups.
Palmer's injury is not the only one on England's mind, with back-up fly-half Charlie Hodgson likely to miss the World Cup with a knee injury, while openside Lewis Moody is also battling to make the event after sitting out the recent tour to Australasia, which saw the English cement their place as the top-rated team in the Zurich World Rankings.
By Mark Smith