Dislocated knee. I'm no doctor and a quick Google search for similar injuries to NFL running backs didn't turn up much. I know some OL have had it (DeCastro this year, Carimi last year), and Stafford had it in 2009.
I would imagine if the ligament damage isn't too bad, then he could be fine a la McGahee back in the day after a year of sitting.
I think he can come back, but whether he ever becomes the back people thought he could be, I'm not so sure. Torn ACL, dislocated knee in subsequent years. You don't find many players and especially RBs that have to major knee injuries in consecutive years and really come back strong after that point. I think the question is whether Lattimore just becomes a career backup/role player going forward, or does he recover enough to become the star/feature back everyone expected him to become?
"Vincere scis, Hannibal, victoria uti nescis" -- Maharbal, 216 B.C.E.