James, 26, made the announcement via Twitter on Wednesday evening (11 June), thanking his team for their work on his debut self-titled album.
"Just to clear things up - I am no longer with Syco," he said. "I would like to thank all at the label for making a great record with me.
"I now have to move on and do something different - the future is bright! #LOVE."
When asked by a fan if he has signed with another record company, James replied: "Not yet but there is a lot of interest which is encouraging. I just wanna make great songs."
Syco have yet to make a comment.
Just to clear things up - I am no longer with Syco. I would like to thank all at the label for making a great record with me.— James Arthur (@JamesArthur23) June 11, 2014
After winning the ninth series of The X Factor in 2012, James went on to achieve a number one hit with 'Impossible'. His debut album hit number two in the charts and spawned the singles 'You're Nobody 'Til Somebody Loves You' and 'Recovery'.
James also kicked off his first UK and European headline tour in January this year.
Despite his music success, James ditched Twitter in November 2013 following a number of high-profile spats. He was embroiled in disputes with One Direction, Matt Cardle and Frankie Boyle, and faced public backlash after making a homophobic slur in a rap song.
The singer-songwriter apologised for his actions following a performance on The X Factor a month later, but soon after making a return to the social networking site, he was embroiled in another Twitter spat with a model.
James made the headlines again in April this year after hitting back at claims that his new song 'Follow The Leader' glamorised terrorism. At the time, James also dismissed reports that he was at risk of being dropped by Syco over the track.
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Watch James' video for 'Recovery' below: