The 25-year old has returned to his homeland for the 2013 season but prior to his departure, Seattle signed him to a multi-year contract extension.
Montero heads to Millonarios as he attempts to break into the Colombia team ahead of the 2014 World Cup in Brazil.
"Fredy has been a fantastic player and pro for Sounders FC over our first four years," said Owner and General Manager Adrian Hanauer.
"We wish Fredy the best of success with Millonarios as he continues to develop as a player. We hope this move helps Fredy's chances of being called up to the Colombian National Team, as he has certainly earned it."