Montolivo was named captain for the friendly at Craven Cottage, but the AC Milan man was stretchered off after just 15 minutes of the World Cup warm-up.
He was injured in a challenge with Ireland defender Alex Pearce and Italy's team doctor Enrico Castellacci has confirmed Montolivo will miss the World Cup in Brazil.
"It's what we feared, a fractured tibia," Castellacci told Rai television.
"It will probably need some months, Riccardo is out of the World Cup. He didn't deserve this."
Italy coach Cesare Prandelli added: "The game was marked by the misfortune that Riccardo suffered.
"It's difficult to talk about the technical things when something like that happens. We are all stunned by what happened."
Prandelli had named a preliminary 30-man squad earlier in May, with Montolivo expected to make the final cut.
He must now decide who will make the trip to Brazil, with the final 23-man squad to be submitted to FIFA by Monday.
The four-time World Cup winners face England in Manaus in their opening Group D game on June 14 before also tackling Costa Rica and Uruguay.