While Palin's time at Fox was occasionally rocky, the network's news executive, Bill Shine, said Friday that "we have thoroughly enjoyed our association" with her.
"We wish her the best in her future endeavors," said Shine, Fox's executive vice president for programming.
A person familiar with discussions between Fox and Palin described the parting as amicable, saying that Fox and Palin had discussed renewing her contract but she decided to do other things. The person spoke on condition of anonymity because they were not authorized to speak on the record.
Palin's lawyer in Alaska, John Tiemessen, had no immediate comment on her exit. Palin's last appearance on Fox News was Dec. 19 on Greta Van Susteren's show.
Palin signed to deliver commentary on Fox in January 2010, reportedly for $1 million a year. It was a coup for both sides at the time; the former Alaska governor was a little more than a year removed from her attention-getting run for the vice presidency and was considered one of the leading contenders for the 2012 presidential nomination. At Fox, she had a platform on the most popular network for conservative viewers. Fox installed equipment in Palin's Wasilla, Alaska, home to make her regular appearances easier.
But there were some indications of tension between her and Fox News Chairman Roger Ailes, who was quoted in a 2011 story by The Associated Press saying, "I hired Sarah Palin because she was hot and got ratings."
When Palin announced she would not be a candidate in 2012, she said it on a conservative radio show, which didn't sit well with the company paying her to be a contributor. Palin took to her Facebook page late last summer to complain that Fox had cancelled her appearances one night at the GOP national convention; Fox said it was simply because the GOP had to condense its speaker schedule due to a hurricane.
Four years removed from her vice presidential candidacy, Palin's influence had waned and she was somewhat overshadowed as a contributor at Fox by Karl Rove, former President George W. Bush's top political aide. Rove recently renewed his contract at Fox through the 2016 election.
With four more years of a Barack Obama administration in power, Fox recently hired former Democratic presidential candidate Dennis Kucinich as a contributor.