Emirates club give Brazilian back to his boyhood club.
Arsenal have sent midfielder Denilson on-loan to his former club Sao Paulo for the entire season.
The 23-year-old, signed in August 2006, struggled to hold down a regular place in Arsene Wenger’s side last season.
After making his debut in League Cup game against West Bromwich Albion he went on to make 153 appearances for the Gunners.
The Brazil midfielder is looking forward to getting back into action.
He said: “I will be playing in Brazil next season as I felt that this is a good opportunity for me to play regular first-team football.
“I move away with sadness because I have so many friends at Arsenal and everyone has always been so supportive towards me.
“I’m now focused on doing well in Brazil next season, but will always be looking out for the Arsenal results.
“It is a great club with many great players, a good team spirit and a top-class manager. I wish you well for next season.”
Despite long-term target Felipe Melo now being available,Wenger is likely to trust his youth team and promote Emmanuel Frimpong and Craig Eastmond into the first-team to replace Denilson.