Troup spent the past month showing very little progress since having back surgery in December. That's when he had two disks fused to repair a nagging injury that limited him to playing just six games last season.
Buffalo's 2010 second-round draft pick spent much of training camp working out individually, if at all, and said he was still in constant pain eight months since having the operation.
On Wednesday, Troup had limited practice time working solely with the scout team. In the latest depth chart released by the team this week, Troup was listed fourth and last behind starter Kyle Williams.
"I told him today when we visited that I was proud of him for the way he fought to get back, but he just could not make it," Gailey said. "We wanted to let him not worry about it anymore and go get well. We will give him a run next year."
Troup has one year left on his four-year contract.
The Bills had high expectations of Troup when they selected him with the 41st pick out of Central Florida. He had a promising rookie season in which he finished with 23 tackles and two pass breakups in 15 games, including three starts.
A series of injuries began hampering Troup during training camp last year. He was eventually placed on IR in November.
This year, Troup was held out of the team's spring minicamp practice sessions with the anticipation he could be ready for the start of training camp last month. After being cleared for the start of camp after a conditioning session, Troup had a setback the next day.
Two weeks ago, Troup said he was second-guessing himself on why he had the procedure, even though doctors said it would be necessary.
"If I could go back, yeah, I probably wouldn't have wanted to deal with this," he said.
The move leaves the Bills with an 85-player roster heading into their preseason game against Pittsburgh on Saturday. NFL teams have until Monday to reduce their rosters to 75 players. The deadline to establish 53-player rosters is Aug. 31.