Dave Gavitt, head of Celtic basketball operations, said that doctors had recommended rest and anti-inflammatory medication for Bird.
Gavitt emphasized that the problem was caused by a fall during practice last month and is not related to back surgery Bird underwent June 7.
"We got a good diagnosis on Larry--an encouraging diagnosis," Gavitt said. "And Larry's outlook is very positive right now. . . . I think we're encouraged that he's encouraged."
No timetable was set for Bird's return. He has sat out four games and will be eligible to come off the injured list Jan. 17 for a game against the Philadelphia 76ers.
Bird sat out 22 games because of his back last season, during which time the Celtics were 10-12.
He made a rapid recovery from the surgery, then signed a two-year contract extension that was worth more than $8 million.
Bird was playing without pain early this season until falling during practice in early December.
Gavitt said it is important now that Bird not try to play through pain as he did earlier this season.
"There's another message here: Don't minimize symptoms, don't try banging your way through and playing," Gavitt said. "And now, I don't think Larry will. He has got to let other people interpret symptoms. He has been interpreting symptoms based on who we're playing."