Hunter's body was not feeling good enough to play and he decided to retire, a source said.
With an open spot on their 90-man roster, the Bills could pursue more depth at offensive tackle before training camp begins July 31.
Hunter, 34, was signed by the Bills on July 1 after he participated in a tryout during the team's minicamp in June. He was expected to compete for a roster spot as a swing tackle.
"I think in an ideal world there are some players for whatever reason that are better in multiple roles and being almost like a utility guy, playing guard, tackle, tight end," coach Rex Ryan said of Hunter in June. "Giving you a lot of that versatility, a smart, athletic guy. That is why he is here."
Hunter's release is good news for second-year tackle Seantrel Henderson, who appeared to slip on the depth chart this spring and looked poised for a training camp battle with Hunter this summer. Henderson now has the inside track to the third tackle spot on the Bills' roster, as undrafted rookie Tyson Chandler is the only other option at the position behind Cordy Glenn and Cyrus Kouandjio.
Hunter had spent the past two seasons out of football after last playing for the St. Louis Rams in 2012.