Michael missed the second half of last season with a broken leg.
His 899 rushing yards and eight touchdowns rank fifth in the Big 12, and he's expected to undergo surgery in a couple weeks after the swelling goes down. Sherman was unsure which knee was injured.
Michael had 149 carries on the year, but Gray had 733 rushing yards on 159 carries and led the team with 1,133 yards and 12 touchdowns last year.
Michael's the second Big 12 star to go down with a torn ACL this past weekend, after Oklahoma's Ryan Broyles suffered the same injury earlier in the win over the Aggies.
Michael's also the latest rusher in the Big 12 to go down with a serious injury. Texas Tech's Eric Stephens is out for the rest of the year with a dislocated knee, and Oklahoma's Dominique Whaley's season is also done after suffering a fractured ankle against Kansas State.
Iowa State running back Shontrelle Johnson led the team in rushing before a neck injury ended his season. Texas' Malcolm Brown missed Saturday's game with turf toe and leads the team with 635 yards. He'll spend this week in a boot and was listed as the No. 3 back on Monday's depth chart.