Citing anonymous sources, ESPN reported Tuesday that the Colts plan to hold a news conference to announce the long-expected decision. Manning is expected to attend.
Team owner Jim Irsay and Manning's agent, Tom Condon, did not immediately respond to messages left by The Associated Press.
Manning turns 36 later this month, and missed the entire 2011 season after a third neck surgery. Before that, he'd never missed a game in his 13 NFL seasons.
He is owed a $28 million bonus, and with the Colts holding the top draft pick, they apparently have decided it was too risky and pricey to keep the four-time league MVP.
Manning led the Colts to the 2006 NFL title.
