The team announced the move Thursday, nearly eight months after owner Bud Adams said the team would trade or release Young.
Young is 30-18 in five seasons, including a playoff loss. He's battled questions over his work ethic, leadership and injuries.
With the new labor deal, the Titans had to move quickly to avoid paying Young a $4.25 million roster bonus that had previously been due on the 10th day of a new league year. He also was scheduled for $8.5 million in salary this season, making him too pricey to trade to another team.