Manchester City had been hopeful the brilliant winger had avoided the dreaded injury, suffered when she appeared to wrench her right knee while overstretching for the ball on Sunday.
The injury forced Fowler out of the FA Cup semi-final against Manchester United, which City ultimately lost 2-0, inside 20 minutes.
City interim manager Nick Cushing had admitted it "doesn't look great imminently" but said City were "not fearing the worst."
But scans confirmed the 22-year-old had suffered the dreaded injury, which means a full knee reconstruction.
"Manchester City can confirm Mary Fowler has suffered a rupture to her anterior cruciate ligament," City said in a statement on Wednesday.
"Mary will remain under the care of the club's medical team and start her rehabilitation.
"Everyone at City wishes Mary all the best on a full and speedy recovery."
It will likely rule Fowler out for close to a year, in a hammer blow to Australia's hopes next March of winning the Women's Asian Cup for the first time since 2010.
The attacker has been in dynamic form for City, scoring 10 goals across all competitions, and underlined her ability with a starring role in Australia's friendlies against South Korea earlier this month.
"I'm really disappointed to be facing some time out of the game," Fowler said.
"It's never easy when something like this happens especially when you've been working so hard and feeling good.
"The road ahead will be challenging, but I'm ready to take it on.
"There's still so much I want to achieve, and I'll be using this time to grow in every way I can.
"I'm committed to doing the work, staying positive and coming back better than ever."
Fowler's injury also means the new Matildas coach, widely expected to be current Lyon boss Joe Montemurro, will be unable to call on her early in their tenure.
"Everyone in the Matildas and Football Australia family – players, coaches, and support staff – will be right behind Mary as she takes the first steps toward her comeback," interim coach Tom Sermanni said.
Losing Fowler also piles more pressure on Arsenal star Caitlin Foord to be Australia's main attacking threat.
The Matildas are still without skipper Sam Kerr, who suffered the second ruptured ACL of her career during a training camp with Chelsea in January 2024.
Kerr, who joined her Matildas teammates in camp this month, is still considered several weeks away from playing.
"It's difficult to put a timeframe on it," Chelsea coach Sonia Bompastor said on the weekend.
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