Schraeder, who lost his job to Ty Sambrailo at the end of last season, had three years and $18.8 million remaining on his contract.
"The last six years have been nothing short of amazing," he said. "I can't put into words what this team and city mean to me. I want to personally thank Arthur Blank, Thomas Dimitroff, Scott Pioli, Dan Quinn, and Chris Morgan. The whole organization is first-class, and I am very lucky to have this experience. I'd also like to thank all the fans personally. You guys rock, and the love you showed me was real. Thanks Atlanta!''
The Falcons will designate Schraeder as a post-June 1 cut, giving them a $6.45 million cap savings.
Schraeder, a former undrafted player out of Valdosta State, started 73 of the 88 games he played with the Falcons. He started 13 games last season before being replaced by Sambrailo, who signed a three-year, $14.25 million contract extension ($6 million guaranteed) this offseason.
Schraeder signed a five-year, $31.5 million extension ($12.5 million guaranteed) in November 2016. He developed a reputation for being a fighter but had trouble with certain speed rushers on occasion. Schraeder is expected to generate interest on the open market based on his experience. He battled through various injuries last season that affected his play.
The Falcons entered the offseason intent on building the offensive line around perennial Pro Bowl center Alex Mack and one-time Pro Bowl left tackle Jake Matthews. The team is set to add guards James Carpenter and Jamon Brown in free agency, and both of them have starting experience.
Carpenter will sign a four-year, $21 million contract including $9.25 million guaranteed, while Brown will sign a three-year, $18.75 million contract with $12.75 million guaranteed.
Quinn said he has confidence in Sambrailo in a starting role, but the Falcons could target a starting-caliber right tackle in the draft. They hold the 14th overall pick.