Williams had spent three years with the 49ers but fell down the pecking order this season after three fumbles in the week eight victory over the Jacksonville Jaguars in London.
The 25-year-old will perhaps be best remembered for his two fumbles against the New York Giants in the 2011 NFC Championship Game, mistakes that contributed to the 49ers' eventual defeat.
"He has been released. We're looking forward to the opportunity to compete within the league somewhere this year," Williams's agent Wynn Silberman told The AP.
"We're very appreciative of the San Francisco 49ers organization for the opportunity to contribute."