Bautista, 37, batted just .143 (5-for-35) with two home runs in 12 games with the Braves.
Braves general manager Alex Anthopoulos said the team's staff agreed that Johan Camargo deserved the opportunity to play every day at third base, meaning Bautista would be hard-pressed for playing time.
"As we looked at it, knowing there weren't going to be at-bats for Jose, that's not fair to him," Anthopoulos said Sunday before the Braves' game against the Miami Marlins. "We talked to [Bautista] last night, and just talked it over with him. ... We agreed that if there wasn't going to be at-bats and playing time here, that's not right for him."
Bautista, a six-time All-Star, signed a minor league deal with the Braves on April 18 and was promoted to their major league roster on May 4.
Entering Sunday's game, the switch-hitting Camargo was batting .226 with two homers and 13 RBIs this season. Anthopoulos said the Braves believe that the switch-hitting Camargo has performed better than his statistics indicate, citing "exit velocities" and "bad luck."
"The more that we looked at some things, there were some really good indicators that he might be able to perform a lot better than that," Anthopoulos said.
Anthopoulos also praised Camargo's defense and his work as a replacement at shortstop for Dansby Swanson, who was activated from the disabled list Saturday.
Camargo, 24, was in the lineup at third base for Sunday's game against the Miami Marlins and finished 0-for-3 with two walks and a run scored in the Braves' come-from-behind 10-9 victory. Right-hander Lucas Sims was recalled from Triple-A Gwinnett to fill the open spot on the Braves' roster.
Bautista went unsigned as a free agent for the entire offseason after batting just .203 with 23 homers in 157 games with the Toronto Blue Jays last season.
He was attempting to stay with Atlanta as a third baseman despite playing almost exclusively as an outfielder since 2011. He had a .933 fielding percentage and committed one error in eight games. He also appeared as a designated hitter in two games with the Braves.
Bautista, who spent 10 seasons with the Blue Jays, led the majors in home runs in 2010 and 2011 and has 333 in 15 major league seasons.