The Indianapolis Star reported on Sunday that the point guard will not play again this season.
"I was going to try to come back eventually, but it was decided that I was done when I took my last MRI [on Friday]," Tinsley said before the Pacers beat the Bulls on Saturday, according to the newspaper.
The Pacers are only 1½ games behind the Atlanta Hawks for the final playoff spot in the Eastern Conference. Indiana expects to have forward Jermaine O'Neal, who has missed 30 games with a bone bruise in his knee, back for the stretch run.
Tinsley averaged 11.9 points and 8.4 assists in 39 games this season.