"But we have since found that he suffered a small tear in his tendon from the same incident.
"So not only will he miss the Derby but will be away from racing for quite a while."
McKee is gutted by the loss as he believed Knight's Tour was the horse to give him his first Derby on his home track.
"All along he has looked a Derby horse so it is a hard one to cop.
"We will see how he recovers and maybe a race like the Queensland Derby is still an option down the track.
"But I think that much of him if he comes back well then I want to take him to Melbourne in the spring."
One silver lining of the injury cloud is that should McKee choose to aim Knight's Tour at a race like the Caulfield Cup he would get in very light at the weights and could try and sneak in the 2400m feature via a qualifying race.
But the South Auckland trainer admits he harbours a bigger dream than that.
"I think with some ringcraft he could be a Cox Plate horse," said the man who helped saddle Sunline for her two wins in the Moonee Valley race of champions.
"I know a lot can happen between now and he would need to keep improving but that is how highly I rate him."
As good as he was winning his last start, it was his Guineas defeat of Ocean Park and Burgundy on Boxing Day which left little doubt Knight's Tour could win the Derby.
His withdrawal will see Silent Achiever and possibly Ocean Park shorten into something like $3.75 joint favouritism for the Derby, to be run on March 3. Knight's Tour had been at $7 in the market last night.
McKee says stable star Mufhasa will head to Otaki for the group one Haunui Farm Classic on Saturday week.
McKee was far from disappointed by the wonderful galloper's second to Veyron at Te Rapa on Saturday and with most of the big names from that race bound for Otaki, too, it shapes as a thriller.
While Knight's Tour will hopefully be back racing later this season, one star who won't be seen on the track again is Banchee.
The 4-year-old mare has been retired after a frustrating year since she won last season's Karaka Mile.
The Diamond Stakes (group one) and Matamata Breeders Stakes (group two) winner has been retired to Pencarrow Stud, where she will have enormous worth as a broodmare.
Meanwhile, with Pick6 being only partially struck at Te Rapa last Saturday it will be guaranteed to $500,000 again this Saturday.
The pool for the New Plymouth jackpot will start with a carry over of $239,153.
TOUR CUT SHORT
* Knight's Tour is out of the Telecom Derby.
* The Northern Guineas winner could miss the rest of the season.
* Group one-winning mare Banchee has been retired.
* Pick6 will again be guaranteed to $500,000 this Saturday at New Plymouth.