Berardi was injured in Sassuolo's 1-0 defeat at Hellas Verona on Sunday, where the winger was returning from a meniscus operation which saw him miss the previous six games.
"The instrumental examinations carried out on Domenico Berardi showed a complete tear of the Achilles tendon in his right leg," Sassuolo said in a statement, adding that he will have surgery on Tuesday.
Berardi has scored eight goals in 28 appearances for Italy, and came on as a substitute in the Euro 2020 final against England and converted the first spot kick in their penalty shootout win as they lifted the trophy.
Italy coach Luciano Spalletti may now need to plan without the winger for this year's Euros in Germany, while the injury is also bad news for a Sassuolo side battling relegation.
They are second-bottom after collecting one point in their last eight games.
