The Barcelona lynchpin was stretchered off the field in the first half of Friday's 1-0 success, having damaged her knee while sliding on the turf and immediately signalling to the bench that she could not continue.
Walsh returned to the dugout on crutches as Sarina Wiegman's side held out for a second consecutive one-goal win, and there were fears that the 26-year-old had become the latest high-profile women's player to suffer a devastating ACL injury.
However, England have now shared the reassuring news that Walsh has avoided such a serious issue, although the world's most expensive female player will not be available to face China on Tuesday.
"Following a scan late on Saturday afternoon, we can confirm Keira Walsh has not suffered an anterior cruciate ligament injury," a statement read. "Walsh has been ruled out of Tuesday's final Group D match and will remain at our Terrigal base to continue her recovery."
England - who are already without the injured Leah Williamson, Beth Mead and Fran Kirby - will be guaranteed to progress to the knockout stages as Group D winners with a point against China, who sit third in the section on three points.