Sexton turned his foot prior to the team announcement but head coach Declan Kidney stated that 'we expect he'll be fine' when he announced his matchday 23 at lunchtime.
The 24-year-old has since had an MRI scan, however, with the results showing a torn tendon in his left foot.
The setback means he definitely won't play any part in Italy but no timescale has yet been set for his return.
Sexton had only just recovered from the hamstring problem that saw his involvement in the defeat to England ended early and prevented him from playing against Scotland and France in recent weeks.
He remains the favourite for the Lions fly-half berth for the summer tour of Hong Kong and Australia but Lions boss Warren Gatland will be eager to find out exactly how much longer Sexton will spend on the sidelines as he prepares for his final squad announcement at the end of next month.
The news is another cruel blow to Irish coach Kidney and co, who saw back-up scrum-half Eoin Reddan break his leg in the final minute of the draw with France last Saturday night.
Kidney is already missing the likes of Lions stars Paul O'Connell, Stephen Ferris, Tommy Bowe and Gordon D'Arcy, while Simon Zebo broke his foot against England and Fergus McFadden damaged ribs five days ago.
Sexton's absence means Paddy Jackson moves back into the No10 shirt having worn the starting jersey against the Scots and the French, with Ian Madigan taking Jackson's place on the bench.
It means the only change to the starting line up is Craig Gilroy's inclusion instead of the injured McFadden, although there are two further alterations among the replacements as Devin Toner comes in for Donncha O'Callaghan and Paul Marshall replaces Reddan.
Ireland (versus Italy, Stadio Olimpico, Saturday 2.30pm)
Rob Kearney (Leinster); Craig Gilroy (Ulster), Brian O'Driscoll (Leinster), Luke Marshall (Ulster), Keith Earls (Munster), Paddy Jackson (Ulster), Conor Murray (Munster); Cian Healy (Leinster), Rory Best (Ulster), Mike Ross (Leinster), Mike McCarthy (Connacht), Donnacha Ryan (Munster), Peter O'Mahony (Munster), Sean O'Brien (Leinster), Jamie Heaslip (Leinster, captain)
Replacements: Sean Cronin (Leinster), David Kilcoyne (Munster), Stephen Archer (Munster), Devin Toner (Leinster), Iain Henderson (Ulster), Paul Marshall (Ulster), Ian Maidigan (Leinster), Luke Fitzgerald (Leinster)