Williams, 23, was a fifth-round pick of the Bills in 2016. He rushed for 94 yards and scored a touchdown on 27 carries as a rookie.
Williams had ball security issues in May, prompting offensive coordinator Rick Dennison and running backs coach Kelly Skipper to have a heart-to-heart with the running back.
Buffalo had to make three corresponding moves after claiming linebacker Deon Lacy from Miami, tight end Khari Lee from Detroit and offensive tackle Conor McDermott from New England. Besides Williams, the Bills cut linebacker Gerald Hodges and one other as yet unknown player.