A non-roster invitee to camp, Igawa was among nine players optioned or reassigned to Minor League camp after the Yankees' 5-3 Grapefruit League victory over the Orioles.
Also departing big league camp were pitchers Wilkins Arias, Jeremy Bleich, Andrew Brackman, Christian Garcia, Wilkin De La Rosa, D.J. Mitchell and Kevin Whelan and catcher Kyle Higashioka.
Igawa, 30, signed a five-year, $20 million contract with New York before the 2007 season, but the Yankees have seen little return on that investment, to say nothing of the $26 million posting fee paid to his former club, the Hanshin Tigers of the Japanese Central League.
Igawa was 2-4 with a 6.66 ERA in 16 Major League games with the Yankees in 2007 and '08. He spent all of last season at Triple-A Scranton/Wilkes-Barre, where he owns a dubious franchise record with 29 victories.
Igawa had a 16.87 ERA in two Grapefruit League appearances this spring, allowing five runs on four hits in 2 2/3 innings while attempting to work as a reliever.
Regarding his chances of making the club, Yankees manager Joe Girardi said earlier this spring, "If you're here, you have a chance. Anyone that has a uniform on has a chance. That's the great thing about baseball. Until they take that away, you've got a shot."
Brackman was optioned to Class A Tampa, Garcia was optioned to Double-A Trenton and De La Rosa was optioned to Triple-A Scranton/Wilkes-Barre. The other six players were reassigned.
Yankees director of media relations Jason Zillo said that two players on the club's split-squad trip to Lakeland, Fla., were also cut and will be informed in the morning.
Bryan Hoch is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.