Wolverines coach John Beilein had no timetable for Hardaway's return or specifics on the injury.
"We made an educated decision that it is the long road in the Big Ten is more important than having him ready for every game," Beilein said. "If it had been a Big Ten game, we still would have sat him. Want to be very clear about that.
"Based on what I found out about the injury, it is something that needed a little bit of time or could be something that could nag him all year long."
Beilein said he will give Hardaway some more days of rest before re-evaluating his status for the Big Ten opener at Northwestern on Jan. 3.
Hardaway is second on the No. 2 Wolverines in scoring (15.8 points) and third in rebounding (5.3). He has led Michigan in scoring four times this season and, until Saturday, had not missed a game in his three-year Michigan career. Prior to Saturday, he had played in 81 straight games.
In Hardaway's absence, Michigan started freshman Caris LeVert. LeVert finished with nine points and five assists.
Hardaway's absence also left Michigan without two of its regular rotation players. Redshirt sophomore forward Jon Horford remains sidelined after dislocating his knee against West Virginia last month.
No timetable has been set for Horford's return.