The move clears the way for right-hander Jeff Samardzija to start Sunday's game against the Blue Jays.
Another move is expected when Jason Hammel reports to the A's on Sunday.
The A's obtained Samardzija and Hammel in a trade with the Chicago Cubs on Friday.
Milone, who threw six innings in Friday's 1-0 extra-inning win over the Blue Jays, was 6-3 with a 3.55 ERA and .245 opponents batting average in 16 starts.
He opened the year going 0-3 with a 5.86 ERA in five starts. He's 6-0 with a 2.62 ERA in 11 starts since.
Milone is 31-22 with a 3.84 ERA in 75 games, 73 starts, in three seasons with the A's.