Randle had been excused from the team since last week to deal with what the club called a "personal issue." According to sources, he is also facing a suspension for violating the NFL's personal conduct policy for an incident in February in Wichita, Kansas.
Cowboys owner and general manager Jerry Jones did not want to say whether the decision was related to impending NFL discipline.
"We don't want to go there as an organization as far as our relationship with Randle," Jones said. "We just think it's time for us to not have him on the roster. That's the decision we made today, and we stand ready to help him work through any of his other issues."
After Sunday's loss to the Seattle Seahawks, Jones said he was concerned for Randle's well-being.
"I'm always concerned as to any issues regarding the [mental] health of a player," Jones said. "It's a lot more serious than the football [injury]."
According to sources, Randle made a call to police last week because of concern about the whereabouts of his girlfriend. However, no wrongdoing was found.
In September, Randle met with NFL officials after he was cleared legally regarding a domestic violence call in February involving the mother of his son. Per league policy, a player can still be disciplined even if there is no legal penalty.
Failing production, off-field incidents and pending NFL discipline were all factors in the Cowboys' decision to release Randle; a source told ESPN's Ed Werder that "all things were included in this decision."
It has been a quick fall for Randle, who was viewed last spring as the replacement for DeMarco Murray, who ran for an NFL-best 1,845 yards last season and left via free agency for the Philadelphia Eagles.
In five games -- all starts -- Randle ran for 315 yards and a team-high four touchdowns on 76 carries, but he angered coaches at times. In Dallas' Oct. 5 overtime loss to the New Orleans Saints, he reached the ball over the goal line and needed a replay reversal for a touchdown to be called, but the coaches reacted harshly because it was the second straight game he did it despite their orders not to.
When asked how the move made the Cowboys better, Jones said, "Well, we've been pleased with how McFadden has basically stepped up his competitiveness. His resolve has given us a foundation and a leadership at the running back position. It's critical, so that's certainly a consideration and then we have a couple of young backs in Christine Michael and Smith that we think can really contribute to the team as well. We're in good shape at running back or we wouldn't have made this decision."