Dillon's agent, Steve Feldman, told The Associated Press on Friday that his client will ask the Patriots for his release and that the team is likely to grant it by March 2, the start of free agency.
Dillon told The Boston Globe that he would probably retire, but Feldman, while acknowledging that retirement is a possibility, said it is unlikely.
"Corey does not have to play, but he still figures he's got a couple of years left as a premier performer and the Patriots have been kind enough to understand that," he said.
Dillon will not re-sign with the Patriots, Feldman said.
Dillon, 32, is the top active runner in the NFL, with 11,241 career yards in seven seasons with the Cincinnati Bengals and three with the Patriots.
He still has three years remaining on his current contract and was scheduled to count $4.4 million against the salary cap in 2007.
In his first year with New England in 2004, after he was acquired from the Bengals for a second-round draft pick, Dillon ran for a regular-season franchise record 1,635 yards on 345 carries and helped the team beat the Philadelphia Eagles 24-21 in the Super Bowl.
His production dropped off the next two years. He had 733 yards on 209 carries 2005 while battling a high ankle sprain. Dillon had 812 yards on 199 carries last season when he split duties with rookie Laurence Maroney.
Feldman said that while Dillon is healthy, he knows Maroney is the future. "It's that if Corey were to stay, his carries would be limited, and Corey feels he has more to give."
In three years with the team, he ran for 3,180 yards and scored 39 touchdowns in 43 games. After not playing in a single playoff game in seven seasons in Cincinnati, he played in eight in three seasons with the Patriots.
"I gave them what they wanted, I didn't come in and steal money," Dillon told the Globe. "I felt like the money they spent was well earned."