The 36-year-old midfielder has left the Ligue 2 club after just one term, with the Monegasque outfit announcing the decision on their official website
Both parties announced on Friday that they will bring an end to their association, despite the 36-year-old having one more year left to run on his contract.
Giuly previously played for the club from 1998 to 2004, memorably leading them to the 2004 Champions League final in a glittering career which has seen him turn out for Lyon, Barcelona, Roma and Paris Saint-Germain.
The midfielder returned to Monaco after their shock relegation from Ligue 1, making 28 appearances and scoring five goals.
A statement on the club's official website reads: "The club wishes to thank Ludovic Giuly for all that he brought AS Monaco FC throughout his career. Ludovic will always be welcome at the Stade Louis II and AS Monaco FC."
The midfielder himself spoke positively of his time in Monte Carlo, saying: "Monaco has allowed me to express the best years of my life as a footballer. I want to thank the leaders for the conditions in which I ended my adventure with ASM FC."