The 29-year-old right-hander was a 19-game winner in 2006 and 2007, starting the Yankees' postseason openers in both years, but he hasn't been the same since severely injuring his right foot while running the bases at Houston on June 15, 2008.
"We're disappointed. We'll obviously consider all offers as a free agent, as all free agents do," said Wang's agent, Alan Nero.
Staying with the Yankees is a possibility.
"We'll take our time to make a good decision," Nero said.
Wang missed the final 3½ months of the 2008 season, then allowed 23 runs in six innings over three starts when he returned this year. He went back on the disabled list, then returned in late May to make three relief appearances and six starts before his season was ended by shoulder pain.
Wang wound up 1-6 with a 9.64 ERA and Dr. James Andrews repaired a tear in the right shoulder capsule during arthroscopic surgery on July 29. Wang is not expected to be able to pitch until sometime between April and June.
He made $5 million this year, a million raise over his salary in 2008, when he lost in arbitration.
By allowing him to become free, the Yankees can cut his salary by more than the 20 percent limit set by baseball's labor contract for players on rosters.
"There's no doubt that we had to make a tough decision," general manager Brian Cashman said in a statement. "We are still hopeful that our relationship can continue, but those decisions are yet to be made."