This comes just minutes after Aaron Wilson mentioned that this move was expected.
According to OverTheCap.com, releasing Graham will free up $3.125 million in available cap space while creating $750,000 in dead money.
Graham, 29, was in the final year of his three-year, $11.25 million contract that included $4.5 million guaranteed. He was set to make a base salary of $3 million for the 2016 season.
In 2015, Graham appeared in eight games for the Texans and recorded four receptions for 30 yards receiving and a touchdown.