Ehrhoff signed a 10-year, $40 million contract with the Sabres in 2011. He made $18 million over the first two years of the deal.
The Sabres used their second compliance buyout on Ehrhoff. Buffalo also bought out underperforming forward Ville Leino on June 17.
TSN was the first to report the move, which was announced by the team on Sunday.
Buffalo had high hopes for Ehrhoff and Leino after making a splash under new owner Terry Pegula in 2011. But the team has struggled.
Ehrhoff, 31, has 313 career points in 692 games.