Middlesex have cancelled the final year of Gareth Berg's contract after he missed most of the 2014 campaign through injury.
The 33-year-old only played one match for the side before being forced to undergo shoulder surgery.
Berg made his Middlesex debut in 2008 and went on to score over 4,000 runs and take 221 wickets for the club.
"This is a very sad situation for Gareth, myself and the club," managing director of cricket Angus Fraser said.
He added: "He has been a very important member of our side and I do not think it's a coincidence that Gareth's absence has come during a period when we have struggled to win games.
"I really hope that Gareth is able to make a full recovery from this injury and that we may once again see him playing at Lord's."
|Gareth Berg eyeing injury recovery|
|"I know that this is not the end of my career, just another hurdle I need to overcome. My goal over the winter is to get fit and ready for another season."|
The shoulder surgery that Berg had in April revealed an abscess, which was subsequently treated with antibiotics. Once that infection had cleared, a further examination discovered a muscle tear which required another operation.
Middlesex have offered the South Africa-born player the use of their medical and support staff during the winter in his bid to make a full recovery.
A club statement said that should Berg return to the level of fitness required to play first team cricket, they "would then be prepared to sit down with the player to discuss a potential way forward".
Berg, who has played 15 Twenty20 matches for Italy, said he was determined to regain full fitness.
"I walked through the Long Room every morning of every day's play just to soak in all of this wonderful ground's history and keep me humble and honoured," he said.
"It's sad that I won't be doing this any longer. I know that this is not the end of my career, just another hurdle I need to overcome. My goal over the winter is to get fit and ready for another season.
"Hopefully I will be walking through the Long Room once again."
Meanwhile, Middlesex have not offered a new deal to all-rounder Ollie Wilkin because of a shoulder injury.
The 22-year-old played in one 40-over game and three Twenty20 matches during two years with the club.