The former Chelsea man has become a regular fixture under Mikel Arteta since the Spaniard took the reins at Arsenal, and he has also become renowned for his influence in the Gunners' dressing room.
However, Luiz's deal at the Emirates is due to expire at the end of the season, and he has been plagued by a hamstring injury during his final few weeks at the club.
According to Sky Sports News, Arsenal met with the 34-year-old to discuss his future on Friday, and both parties agreed that it would be best for the veteran to move on this summer.
The Brazilian has totalled 73 appearances for the Gunners since arriving in an £8m deal from Chelsea in the summer of 2019, scoring four goals and winning one FA Cup during his time in North London.
William Saliba is expected to fight for a place in the Arsenal defence once he returns from his loan spell at Nice, while Arsenal are also believed to be in the race for Joachim Andersen as they weigh up replacements for Luiz. body check tags ::