A statement on the club's official website confirms the inevitable departure, as Neill is not included on the list of retained players for the 2009/10 season.
The Australian rejected a one-year extension to his current deal, which has now expired.
The club claim to have made him a significant offer, which has officially been rejected and the full-back can speak to other clubs.
The 31-year-old is expected to attract interest from other clubs, including Manchester City, and West Ham have wished him well after two-and-a-half years service at Upton Park.
ExodusAmong others leaving the club appear to be Diego Tristan, Lee Bowyer and Walter Lopez while loan signings David Di Michele and Radoslav Kovac have returned to Torino and Spartak Moscow respectively.
Meanwhile Hammers boss Gianfranco Zola has enhanced his goalkeeping options with the signing of Hungary Under 21 international Peter Kurucz from Ujpest FC.
The 21-year old has been on-loan at the club since February and has impressed enough to earn a four-year deal for an undisclosed fee.
Kurucz joins Czech shot-stopper Marek Stech as competition for number one Robert Green, as Zola prepares to build on a successful first season as manager.