"For 14 wonderful years, the only pro football I've known is Colts football," Manning said during Wednesday's news conference.
"My team won a lot of games here, I played with so many great players here. ... Times change, circumstances change and that's the reality of playing in the NFL."
Manning added: "Our circumstances make it best for us to take this next step. It certainly has not been easy for me."
The Colts' decision to part ways with the four-time MVP, who has thrown for over 54,000 career yards with 399 touchdowns, did not come as a surprise, as it had been the subject of rampant speculation for months. Manning missed all of 2011 after undergoing neck surgery the week before the start of the regular season. He was due to receive a $28 million roster bonus if he had been with the Colts, a team currently in rebuilding mode with a new coach and general manager, at the start of the league year.
Manning said that he'd been preparing for this moment for some time, and that he never found himself lobbying to remain a Colt. There also was not a decisive turning point in his talks with Irsay, Manning said, that sealed this decision.
"We covered all sorts of scenarios. These circumstances are not what either of us wish they were, but that's the reality," Manning said. " ... I am at peace with it."
Throughout the news conference, Irsay and Manning went to great lengths to hammer home the sense that this was an amicable breakup, and that neither party harbors any ill will. Irsay even said that he wanted to see Manning spend his final football years playing for a contender.
"As a franchise, where we are right now with the salary cap, we're a few years away," Irsay said. "I want to see him come back and play great. There's no question about it. It's just, here, (it's) just like in 2001 when he was completely healthy and we didn't have everyone to surround him. I just want to see him succeed at the end of his career."
Wednesday's news conference was just as much about celebrating Manning's tenure in Indianapolis as it was about mourning his exit.
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"I think the No. 18 jersey will never be worn again by a Colts player on the field," Irsay said. "This process has been a long, difficult process. I know Peyton and I have had numerous conversations over the months. ... We tried to put each other in each other's shoes, and tried to realize what the situation was for the franchise, what it was for Peyton. ... In the end, the circumstances were too difficult to overcome."
The divorce marks the end of a remarkably successful marriage between a player and a team. Manning started every meaningful game for 13 seasons in Indianapolis -- 227 in a row, including the playoffs -- and transformed the Colts from perennial also-rans into one of the NFL's model franchises, winning Super Bowl XLI.
In the two decades predating his arrival, the Colts won 116 games and one division title and made the playoffs three times. With Manning taking snaps, the Colts won 150 games, eight division titles and two AFC championships. He broke all of the franchise's major career passing records, previously held by Hall-of-Fame quarterback Johnny Unitas.
Indianapolis also broke the NFL record for most regular-season wins in a decade (115) and tied Dallas' mark for most consecutive playoff appearances (nine).
Manning said he hasn't thought about where he'll play next season, but he did tell reporters that he is not going to retire.
Wherever Manning ends up, he stressed that his heart always will remain in Indianapolis.
"I'll always be a Colt," Manning said. "I always will be. That will never change."
The Associated Press contributed to this report.