Additionally, the Mariners said they were releasing utility infielder Munenori Kawasaki from his Major League contract, which makes him a free agent able to sign with any other team as well.
Olivo, 34, hit .222 with 12 home runs and 29 RBIs in 87 games this past season, including a team-leading 68 starts at catcher. He had a $3 million club option to return for a third season, but the Mariners have chosen to let him go as they have catchers Jesus Montero and John Jaso also under team control on the 40-man roster.
Olivo played 130 games in 2011 in his first year back in Seattle, but saw his role diminish this past season with the addition of Montero and Jaso in offseason trades.
Olivo is an 11-year Major League veteran who has also played with the White Sox, Padres, Marlins, Royals and Rockies, as well as a previous stint with Seattle in 2004-05. He signed a two-year, $7 million deal in 2011 with the Mariners, with the $3 million club option for '13.
Kawasaki, 31, signed a Minor League deal with the Mariners last offseason and hit .192 in 104 at-bats in 61 games as a rookie. Kawasaki, an eight-time All-Star in Japan, was the Mariners' nominee for the MLB Alumni Association's Heart and Hustle Award.
The Mariners have four other players -- pitchers Hisashi Iwakuma, Kevin Millwood, Oliver Perez and George Sherrill -- who will also become free agents the day after the World Series ends.