The 38-year-old Owens had earned a one-year contract with the Seahawks after working out with the team earlier this month, setting up a return to the league for the first time since 2010, but he failed to impress during pre-season action.
Owens made just two catches in two pre-season games.
Having sat out last season with a knee injury and despite a lack of interest from teams around the league, Owens however remained optimistic he would be picked up by another team.
"I'm no longer a Seahawk. I THANK the organisation 4 the opportunity, I'm truly blessed beyond belief," Owens tweeted on Sunday. "My FAITH is intact & will NOT waiver."
During his 15-year career, Owens is second in receiving yards (15,934) and touchdown catches (153), but his career was blighted with clashes with team mates during his stints with five other NFL teams.
Meanwhile rookie Russell Wilson will start the season as the Seahawks' quarterback after the team confirmed it had had traded Tavaris Jackson to the Buffalo Bills on Sunday.
Jackson started 14 games for the team last season as they finished 7-9 but the Seahawks made it clear they would adopt a new offensive strategy when they acquired free agent Matt Flynn in March and drafted Wilson during the off-season.
The Bills will send Seattle an undisclosed draft pick as part of the deal.
"Because of our situation and the opportunity with the guys that we have, he (Jackson) deserves a chance to be playing," Seahawks coach Pete Carroll told reporters.
"Buffalo came after him and I hope it's a good thing for him."
Seizing his opportunity, Wilson has emerged as the Seahawks' top signal-caller and will start the regular season opener against the Arizona Cardinals in Glendale on Sept. 9.
A dynamic runner and passer, Wilson was given the start in Seattle's 44-14 pre-season game win over Kansas City on Friday - with Flynn sitting out due to a sore elbow - throwing for 185 yards and two touchdowns.
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