The announcement via their social media pages come as no surprise as speculation has been rife of late that the team is to take a new direction from 2021.
The decision on Grosjean ends a five-year spell with the team.
Grosjean said: “The last chapter is closed and the book is finished. I've been with Haas F1 Team since day one.
“Five years during which we went through highs and lows, scored 110 points in 92 races, but the journey was worth it. I've learned a lot, improved to be a better driver as well as a better man.
“I hope I’ve also helped people in the team to improve themselves. This is probably my biggest pride, more than any of the crazy first races in 2016 or the P4 at the Austrian GP 2018.
“I wish the team all the best for the future.”
Magnussen, who had four years with Haas, said: "The 2020 Formula 1 season will be my last with the team.
"I have had a great time with the team for four years and I look back on a great journey.
"Being part of a brand new team has been a challenge that I have thoroughly enjoyed and it has brought me a huge amount of experience that has helped me grow and develop as a racing driver.
"I would like to thank Gene [Haas], Guenther [Steiner} and all of the race team for their loyalty and trust in me over the past four years.
"I am still working on my plans for the future which I will announce in due course.
"There are still six races to do this season and I am determined to give my all to finish on a high.
"Thank you for all your support."
F2 race winner Nikita Mazepin is amongst the favourites to replace Grosjean, along with current F2 championship leader Mick Schumacher.
As a Ferrari academy member, the Scuderia's placement of Schumacher depends on whether the Scuderia opt to retain Antonio Giovinazzi at Alfa Romeo alongside Kimi Raikkonen, and should the Finn also choose to remain in F1 for another season.
Expressing his gratitude to both drivers, team principal Steiner said: “I want to extend my thanks to both Romain and Kevin for their hard work and commitment to Haas F1 Team over the past few seasons.
“Romain was a fundamental part of our establishment as we sought to get a driver on board with both speed and experience.
"His results in early 2016 were a just reward, not only for his own talent, but also for the sheer amount of effort the team had put in to be on the grid that season.
"When Kevin joined a season later, we saw an immediate return with both cars scoring points, and of course, our first double points finish in Monaco that year.
"We have a lot of good memories together, in particular, our 2018 season when we finished fifth in the standings in only our third season. Romain and Kevin played a significant part in that success.
"Of course, there is still plenty of racing left in the 2020 season. It’s been a challenging year, no doubt about that.
"But both drivers have given their all behind the wheel of the VF-20. We value their inputs and experience to keep pushing the team forward through to the Abu Dhabi Grand Prix in December.”
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