Guillen, who leads the Royals with the 16 home runs and 62 RBIs, did not figure in the club's future plans. He was in the last year of a three-year, $36-million contract.
The move clears the way for Kila Ka'aihue, a top power prospect, to get more playing time. Ka'aihue will share first base and designated hitter with Billy Butler.
"I don't know if I saw it coming this way, but it's all business," Guillen said. "It's going to work out well. It's going to work out for them because they're going to see some of these young guys. They need to see what they can do for the near future. And it's going to work because I [may] get to go a place where there's a playoff team, a team in the race and go from there."
To fill Guillen's spot on the 25-man roster, the Royals called up pitcher Philip Humber from Triple-A Omaha. A starter, he was 5-6 with a 4.47 ERA in 21 games, but will pitch of the bullpen in long relief for Kansas City.
Guillen, 34, had played in all but two of the Royals' 108 games this season, batting .255. In addition to topping the club in homers and RBIs, he was second in hits with 170 and runs with 46. He started as DH in 84 games and in right field in 21 games.
"Jose has been a very productive player for us," general manager Dayton Moore said. "We just felt it was in the best interests of everybody to move on and allow us to play some of our younger players every day. We didn't think it was fair for Jose to sit the bench and not play."
Guillen leaves the Royals in the wake of a terrible slump. He was just 1-for-28 in his last seven games, going hitless in 21 at-bats since collecting his 300th career double.
Although his name was often mentioned in trade rumors before the July 31 non-waiver Trade Deadline and his future was uncertain once Ka'aihue was recalled, Guillen said that was not weighing on his mind.
"I never panicked," he said. "I know the talent that I still have. I know the player that I am. ... I'm pretty sure that I'll be playing soon. I've just got to stay in good shape, keep working out for the next few days."
The Royals have 10 days to trade, release or outright Guillen while opening a 40-man roster spot that is taken by Humber. In his case, only the first two options apply.
"We still have the opportunity to trade him," Moore said. "If we can't, then we'll have to release him."
If Guillen is released, the Royals must pay what remains of his $12 million salary this season.
"If they just let me go, then I get to choose where I go," he said.
Although Guillen was a topic of trade talks last month, nothing came real close to getting done.
"There were some clubs interested, but they were able to accomplish other things that they preferred," Moore said.
Guillen has a limited no-trade clause in his contract but he did not exercise that, according to Moore.
Ka'aihue has been the focus of burning interest by Kansas City fans because of his Minor League power numbers in recent seasons. He bolted into prominence in 2008 when he hammered a combined 37 homers for Northwest Arkansas at the Double-A level and Triple-A Omaha. He also collected 100 RBIs while batting .314.
After tailing off last season -- .252/17/57 for Omaha -- he surged back this year with a .319/14/78 line along with the Pacific Coast League's top on-base percentage of .463. He led the league with 88 walks in 94 games.
"He's a good kid, a good player and he needs to play," Guillen said.
Recalled last Sunday, Ka'aihue started his first game on Wednesday at Oakland and was 1-for-4. Including a brief KC stay in May, he's 2-for-9 in four games. Ka'aihue hit his first and only Major League homer during a September callup in 2008.
"This gives us the opportunity to play Kila a lot more," Royals manager Ned Yost said. "We're just going to go day-to-day with it but I'm going to play Kila at first, I'm going to DH him and give him an opportunity to show us what he can do."
Ka'aihue, a left-handed batter, is likely to bat fourth or fifth behind Butler, depending on how Yost drafts his lineup each day.
"He'll be in the middle of the lineup somewhere," Yost said. "We're left-handed dominant and that's OK because all of our lefties hit left-handed pitching pretty well anyway, so I'm not going to concern myself with trying to split up lefties here and there. We'll try to figure out what's best and go from there."
Yost personally gave Guillen the news on Thursday morning at the team's Seattle hotel along with Moore joining in via telephone.
"Jose was great about it," Yost said. "I like him a lot. He's a professional. He gives you everything. I was really surprised when I got here about how hard he works to prepare himself to play every single day. People don't realize how hard he worked. His whole focus was to try to win and he gave every bit of effort toward that."
Guillen said he'd return to Kansas City to await developments while continuing to work out.
"I appreciate the opportunity that Kansas City gave to me and my family," Guillen said. "There were some rough times and some good times. I had a very good time there -- good people. But we've got to move on. That's life, that's business, that's part of this game."
The Royals were Guillen's ninth Major League club. In his first season, 2008, he hit 20 home runs with 42 doubles and 97 RBIs with a .264 average. In some memorable outbursts, he chided some teammates as being "babies" and was critical of fans. But he also made unpublicized sizable charitable donations and this year was seen in friendly interaction with fans at Kauffman Stadium.
Last season, plagued by leg injuries and back problems, he played just 81 games and his production fell to nine homers and 40 RBIs. After surgery late last season, his legs have been strong and he's overcome some minor problems this year.
"My legs are great so I can either go to the National League or stay in the American League, either one. It doesn't really matter," he said.
Guillen was asked if his agent had any leads about teams that would be interested in him.
"Heh, heh," Guillen said, chuckling. "I'm not going to comment on that. Just stay tuned on that one."
For now, he's just going to go home and wait for the phone calls.
"It's going to work well," Guillen said. "It's going to work out well for Kansas City and for Jose Guillen.
Dick Kaegel is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.