England international fly-half Freddie Burns will leave Gloucester at the end of this season.
The future of the 23-year-old, whose contract runs out at the end of the 2013-14 campaign, has been the subject of much speculation in recent weeks with a move to Leicester mooted.
In a statement on their official website, Gloucester confirmed that talks had been ongoing between the club and player over a new deal but an "agreement has not been reached and, by mutual consent, both parties have started to pursue alternative options."
The club's director of rugby, Nigel Davies, said: "A number of players are out of contract at the end of the season, and I've been pleased to date with those who have re-signed, including the likes of Sione Kalamafoni, Henry Trinder and Billy Twelvetrees.
"Attention has naturally turned to Freddie Burns' situation and, despite lengthy dialogue, we have decided to part company.
"Therefore, we feel that it is important to clarify the situation. Doubtless, a statement on Freddie's future club will be made in due course. However, in terms of Gloucester Rugby, we know where we stand and we will move forward accordingly.
"As always, any statement regarding player signings will made via official channels at the appropriate time.
"Freddie has made a tremendous contribution to Gloucester Rugby and, when he does leave us at the end of the season, everyone at the Club will wish him well.
"Until that time however, I know that Freddie will be fully committed to Gloucester Rugby and that he will be determined to help us be as successful as possible this season."
Burns himself reaffirmed his commitment to the club's cause for the remainder of his contract, saying: "I've had a lot of things to consider regarding my future in recent months, and it's not been easy. But I'm still a Gloucester player and will be giving it 100%, as I always have done, whenever I pull on the shirt.
"Gloucester have been incredibly supportive, they have been ever since I first joined the club. I have so many people to be grateful to. Whatever happens in the future, it all started here for me and I'll always be thankful for that."
Burns has played three times for England, the latest coming against Argentina last year, scoring 37 points.