"In light of recent events, it would have been difficult for Alpay to represent Aston Villa again in the future and the player himself was aware that life in England had become increasingly difficult for him and his family," chairman Doug Ellis told the clubs official website.
"Therefore, both parties agreed that the best course of action was for immediate termination of his contract which was due to expire in June, 2004."
Alpay joined Villa from Fenerbahce for £5.6million in July 2000 and made 71 appearances for the club.