Head coach Dino Babers made the announcement Thursday but declined further comment.
Sheppard, a native of the Bronx, had one tackle and one interception in nine games. Ealey, of Coatsville, Pennsylvania, appeared in seven games and made one tackle.
Both players were suspended indefinitely in November.
Their dismissals leave the Orange with little depth and no experience at the position. Jake Pickard and Kenny Carter, the lone returning defensive ends, are coming off redshirt seasons. The Orange signed three defensive ends Wednesday.