The 41-year-old footballer, who contested elections twice as a Trinamool Congress candidate and lost both times, made his announcement on social media.
"As of today I have officially resigned from the membership and all the official and political posts of All India Trinamool Congress party. I am no longer a member or associated with any political party in India," Mr Bhutia said in a tweet.
Mr Bhutia contested the 2014 Lok Sabha election from Darjeeling but lost to the BJP's SS Ahluwalia by a huge margin. Two years later, the striker contested the West Bengal Assembly elections from Siliguri and lost to a CPM candidate.
The Press Trust of India quoted sources as saying that Bhutia had informed the Trinamool Congress about his decision one month ago as he was "no longer interested in being associated with any political party".
Last year, he was believed to have upset his party by defying the official line and backing the agitation for a separate Gorkhaland, which caused over 100 days of unrest in Darjeeling. Mamata Banjerjee recently said Sikkim - Mr Bhutia's native state - was stirring up trouble in Darjeeling and Kalimpong.
The footballer has in recent years also set up a series of coaching institutes - the Bhaichung Bhutia Football Schools - in New Delhi.
With Inputs from PTI