The Bulls announced Wednesday that Dunn underwent an MRI on Friday that confirmed the initial diagnosis of a sprained MCL in his right knee.
Dunn will progress to "functional training" in four to six weeks, when the Bulls will decide whether he needs additional treatment.
The 25-year-old Dunn has been sidelined since suffering the injury Jan. 31. He is averaging 7.3 points and 3.4 assists in 51 games this season.
Dunn has started in 32 of Chicago's games this season and is six starts from reaching starter criteria and seeing his $4.6 million qualifying offer this offseason increase to $7.1 million, according to ESPN's Bobby Marks.