Sources close to the situation confirmed to ESPN.com on Sunday that Paul tore cartilage in his left knee and will be forced to undergo arthroscopic surgery.
The Hornets are optimistic, sources said, that Paul will miss only one month, including the Feb. 14 All-Star Game. But they won't establish a firmer timetable on Paul's return until after he has surgery.
Yahoo! Sports first reported the need for surgery, saying that test results revealed a partial tear to Paul's meniscus and that he could miss up to two months.
This will be Paul's second extended absence of the season. An ankle injury cost him eight games soon after Byron Scott was replaced as coach by general manager Jeff Bower, but the Hornets managed a 4-4 record during that stretch.
After Paul tweaked the knee in a game Wednesday at Golden State, it appears he suffered the tear Friday night in a home overtime loss to the Chicago Bulls following a scramble for a loose ball and a hard landing on the baseline in the final seconds of regulation.
When Paul is formally ruled out of the All-Star Game, his replacement on the Western Conference roster will be chosen by NBA commissioner David Stern. Prime candidates to replace Paul at guard include Denver's Chauncey Billups and Golden State's Monta Ellis.
Marc Stein is a senior NBA writer for ESPN.com.