Mohammad Kaif is among eight players dropped by the Rajasthan Royals ahead of the Indian Premier League.
Kaif, who has played 13 Tests and 125 one-day internationals for India, was purchased for US $675,000 at the original auction in 2008.
The 28-year-old played in all 16 matches, scoring 176 runs, as the Royals claimed the inaugural IPL title but has been left out of the 2009 squad after the Royals trimmed down their options.
"(Kaif) didn't make the cut," confirmed a team spokesman.
The second edition of the IPL runs from April 18 to May 24 and is taking place in South Africa due to a date clash with general elections in India.