He was scratched from Saturday's start against the Los Angeles Angels after an MRI exam showed that the tibialis tendon behind his right ankle was torn.
"I was getting treatment and we were getting by," said Peavy, who had the ankle heavily taped for his previous two starts and did limited work between outings. "Up until yesterday, I thought it was manageable. It could have gotten ugly if we didn't take the action that we did."
The right-hander will remain in a walking boot for approximately four weeks and re-evaluated in two weeks before it can be determined how much time he will eventually miss.
"That muscle basically helps support the arch in everything he does," Padres trainer Todd Hutcheson said. "So when his foot's on the ground, his weight's on it, so that muscle has to be working in order for him to function properly."
Peavy, the 2007 NL Cy Young Award winner, is 3-1 with a 4.43 ERA in four starts since he voided a trade to the Chicago White Sox. The injury occurred while he ran the bases in his first start after the proposed trade.
"We had it diagnosed right. We just didn't know the extent of it, and that's on me," Peavy said. "These guys go on what I tell them. I certainly wasn't trying to mislead anybody. It just got to the point where it wasn't progressing the way we thought. I felt I was good enough to be out there, but the pictures today showed a little more severity than what we thought."
Peavy is 6-6 with a 3.97 ERA in 13 starts overall. The Padres said the two-time All-Star won't officially go on the disabled list until Saturday, when a corresponding roster move will be made. Rookie Josh Geer will start Saturday in Peavy's place.