Scans this week will confirm the extent of the damage to Dagg's troublesome knee that saw him sit out last night's 57-0 mauling of the Springboks in Albany.
The 66 test veteran missed the first two Bledisloe Cup victories over the Wallabies due to this complaint. He then returned against the Pumas in New Plymouth last week, only for it to flare up again.
All Blacks coach Steve Hansen admitted today the prospect of Dagg returning to the field anytime soon look grim.
"I'd say he'll need some time out of the game," Hansen said. "It sounds like there's some cartilage surface damage to the knee that needs a bit of rest. Doc is pretty confident if he gets the rest he'll be fine so it probably means he'll be out for the rest of the year."
It is a cruel blow for Dagg who has worked hard to reinvent himself in a shift from fullback to the wing since missing the 2015 World Cup squad.
Nehe Milner-Skudder finished two tries in his return to the right wing against the Boks and is likely to be the chief beneficiary of Dagg's ongoing absence.
Waisake Naholo and Rieko Ioane are other options within the squad, while Crusaders fullback David Havili has also travelled as cover to this point.
Hansen was unsure whether a replacement would be called up to the 28-man touring party for the away leg of the Rugby Championship, which starts with a test against the Pumas in Buenos Aires in two weeks.
News was more positive for Liam Squire. The All Blacks blindside left the field with a head knock after impressing in his 27-minute stint but Hansen today gave him a clean bill of health.