Nani's announcement comes days after Orlando lost to Nashville SC in the first round of the MLS Cup playoffs.
Since joining Orlando in 2019, he tallied 28 goals and 23 assists across 77 games (64 starts). The winger was also a two-time MLS All-Star.
"Orlando is a city I can call home, with great people and fantastic supporters, but my contract has ended and there was a decision by the club not to extend it," Nani wrote on Twitter. "It was an honor captaining the club for its first-ever playoff appearances and reaching the final of the MLS is Back Tournament.
"I shall never forget how the fans and community supported me and my family ever since the moment we arrived in Florida. You will have in me a friend and a fan for the future. I wish you all the best."
Nani's departure opens a coveted Designated Player spot for Orlando. The Lions will have two DP spots open, with Mauricio Pereyra the only one on the roster. The team could see further roster upheaval as Daryl Dike continues to gain interest from clubs abroad. Chris Mueller is already confirmed to leave for Scottish side Hibernian.
"We want to thank Nani for the professionalism that he's shown in his time in Orlando," Orlando chairman Mark Wilf said in a release. "Even in the short time since we've taken over as stewards of this great club, we have had great respect for Nani's passion and abilities, while he led us as captain. We wish him the best moving forward."
The 2022 MLS season kicks off in February.