The 35-year old has been linked with various clubs since he walked out, mainly Championship league leaders Newcastle United, and is now free to join any club who is interested.
"Sol Campbell is now a free agent," Professional Footballers' Association chief Gordon Taylor told BBC Sport.
"His contract dispute has been resolved and he is free to pursue football in the January transfer window. He can sign for any club he wants now."
Campbell has been training with Arsenal to keep his fitness up but it seems likely he will land at either Newcastle or fellow Championship high-flyers West Brom.