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Republic of Ireland international Breen, who has made 114 appearances for the Black Cats, led Sunderland to promotion 12 months ago.
However, the Black Cats struggled in defence as they finished with a record low of 15 top-flight points last season.
Breen's departure is the most significant, after the club announced their retained list today.
Goalkeeper Joe Murphy has already joined Scunthorpe and midfielder Martin Woods was told earlier this week he could leave.
Justin Hoyte and Anthony Le Tallec have returned to Arsenal and Liverpool respectively after season-long loan deals, while striker Andy Gray is expected to join Burnley after a temporary move to Turf Moor.
The club have exercised an option to hand injury-plagued striker Kevin Kyle a one-year extension to his existing contract.
Youngsters Dan Smith - the man involved in the challenge which cost Arsenal midfielder Abou Diaby his place in tonight's Champions League final - and Grant Leadbitter, were out of contract but have been offered new deals.
But Luke Ball, son of Kevin, who took over as caretaker manager following Mick McCarthy's departure, is one of five under-18 players to be released.