Lolley suffered the right ankle injury in a challenge from Wellington's Isaac Hughes on Sunday and attempted to play on, but later went down with no players around him and had to be helped off in the 57th minute.
Scans confirmed Lolley, who also missed a chunk of football with a hamstring strain earlier in the season, had suffered a syndesmosis injury.
"It's disappointing for Joe and the team as he's a very influential player for us; but we're hoping he'll return at the back end of the season," coach Ufuk Talay said.
"It's pleasing we've got good strength in depth in the squad and it's a big chance for someone else to step up."
Third-placed Sydney (32 points) trail leaders Newcastle (37) and Auckland FC (35) on the table and lose Lolley, who has four goals and two assists this season, ahead of a key run of fixtures.
Sydney host Melbourne Victory (fifth, 28 points) on Saturday before facing Melbourne City (ninth, 22) then Newcastle ahead of the international break, with Lolley to miss at least those three games.
The loss of Lolley is particularly frustrating ahead of facing the Victory given the winger delivered two stunning strikes to catapult the Sky Blues to a 3-0 win over their fierce rivals back in November.
Sydney expect Lolley to be fit at some point before finals, with games against Brisbane, Western Sydney, Perth and Auckland rounding out their regular season.
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