The 21-year old winger's contract has expired at Madejski Stadium and the club have stated that he will not be offered new terms.
Bozanic joined the Royals in 2007 but failed to make an impression in the first team and was loaned out on three separate occasions with the latest spell away from the club being with Aldershot Town late this season.
According to Aldershot boss Kevin Dillon, the former Australian U20 international was keen to return to Reading during his spell at the Recreation Ground and it seems his time at the League Two club did not end smoothly.
"Bozanic has gone back to Reading," he said. "He's decided that he doesn't want to be involved anymore and the least said about that the better."
Reading, however, thanked Bozanic for his services to the club and wished him well.
"The club would like to place on record their thanks to each of the departing players for their hard work and we wish them every success in the future," a club statement read.