Butler did not return to the game, which the Bulls lost 115-110, after blowing an 18-point lead late in the third quarter.
Coach Fred Hoiberg said after the game that Butler will have an MRI on Saturday in Minneapolis. The Bulls play the Minnesota Timberwolves on Saturday night, the sixth game on a seven-game road trip.
"The early diagnosis is that it's a sprain," Hoiberg said. "In talking to our trainers, the knee seems intact. The ligaments seem stable. He'll get an MRI at 10:30 [Saturday] morning and obviously know a lot more after that."
Butler, 26, was injured after he went up for a basket and was fouled by Nuggets big man Joffrey Lauvergne. Initially, it appeared as if Butler's right knee got caught underneath him as he fell, but it was the left knee that was injured.
A cart was wheeled out to the floor to take Butler back to the locker room, but he stayed in the game to take his free throws. A few moments later he got back onto the cart and was wheeled to the locker room to be evaluated.
Butler walked out of the training room about 15 minutes after the injury and was wearing a large ice pack around his left knee. He kept a good sense of humor about the injury, telling staff members, "Y'all get me the Forrest Gump knee brace."
"He said he heard something pop," said Bulls point guard Derrick Rose, who has dealt with knee injuries before. "But with my knees, I knew that it was something serious."
Rose added that he came to the locker room and said of Butler's knee, "It just seemed that they were icing it, and I guess it was nothing major."
Butler had 19 points and five assists in 18 minutes before leaving.
He missed his first game of the season Wednesday because of left knee tendinitis. Hoiberg acknowledged after Friday's shootaround that Butler still was dealing with soreness in the knee.
Hoiberg said he was unsure how long Butler would be out, but knows the Bulls will be without him at least in the short term as they wait for more test results.
"He's sore," Hoiberg said of Butler. "We've got to be ready to be prepared to play without Jimmy for a time. But I don't want to jump to any conclusions. We'll know a lot more [Saturday]."