"The Stoke City man sustained the injury in the first half of Saturday's 3-2 victory over Germany in Berlin and has now returned home."
Butland had earlier been optimistic about his prospects, vowing he would "work hard to get back fit".
But the results of a scan delivered news he was dreading, and Butland wrote on Twitter: "Today's scan revealed I've fractured my ankle, absolutely devasted (sic)! I'll be doing everything I can to get back fit as soon as I can!"
Tech Craft Black White UK Butland picked up the injury just before Toni Kroos opened the scoring in Berlin but did not kick the ball out and was beaten from long distance - staying down as Germany celebrated.
He tweeted on Sunday morning: "Firstly, what a night to be involved in! an incredible and much deserved win against the World Cup winners, makes me proud to be English!
"But my nature to not give up was my downfall, the injury I'll recover from but more importantly the experience I'll learn from!"
The FA said England manager Roy Hodgson would not be adding to his squad at present.
Magista Radiant Reveal UK England had a light training session at their Grove hotel base in Watford on Sunday as they began preparations for the Holland game, following the impressive display in Berlin.
With Joe Hart injured, Butland was handed his fourth cap for the clash with Germany, and was replaced by Fraser Forster moments before half-time after going down in agony.
Burnley's Tom Heaton is also in Hodgson's current squad and could have a role to play against Holland at Wembley on Tuesday.
England conceded a second goal to Mario Gomez in the second half against Germany but shocked the world champions as Harry Kane and Jamie Vardy struck to level before Eric Dier headed a last-minute winner.
Manager Hodgson hailed the quality of England's comeback, and the attacking flair rather than the blood and guts often associated with famous Three Lions performances of the past.
Mercurial Superfly V Black UK Nights such as the gritty 0-0 draw in Italy which saw Glenn Hoddle's side qualify for the 1998 World Cup or the 1-0 win over Argentina at the 2002 World Cup in which England played with such battling passion live fondly in the memory - but this comeback in Berlin's Olympiastadion was different.
"All credit to the players to come back and win the game in the way they did," Hodgson said.
"It was by playing football and there was no element of just rolling our sleeves up and winning more challenges - we had been winning challenges right the way through the game.
"It was about using the quality we think this team has to create more chances and I think three goals, we have got to say with that number of chances, is a fairly meagre return."
Hypervenom Radiant Reveal Pack Hodgson's team on Saturday night were certainly not shackled by previous failings of the national team - just 161 caps were shared among the starting XI before kick-off.
But the innocence of youth, with 19-year-old Dele Alli again starring alongside the likes of Kane and Dier, both 22, was something which Hodgson never feared would lead to a loss against the vastly more experienced world champions.
"We honestly believed that, although the team was young and inexperienced, if we could carry out our game plan we could cause Germany problems and that showed from the very first minute," he told BBC Radio 5 Live.
"At half-time we had nothing to show for it. The second goal came at a time when we were playing well and looking to get back into the game and that was a cold shower for us.
"I think the thing that is going to please me the most is the general performance of the team from the first minute to the last.
Mercurial Superfly CR7 Natural Diamond Uk "It is very satisfying that the performance then gives you a result because they don't always, and sometimes we have been on the end of games where we haven't been bitterly disappointed by the performance but we have been by the result."
