"I'm disappointed that it has not worked out but these things happen at all football clubs and we must move on," Megson said on the Marshall issue.
Also shown the door by the Albion chief are Bob Taylor, Des Lyttle, Brian Jensen, Matt Collins and Jordao, while the Baggies boss has decided not to turn loan signing Ife Udeze's deal into a permanent one.
"We would just like to thank everybody for their efforts and wish them all the best in their future careers," Megson told the club's official website.
"This is never a nice thing to do but we've got to try and maintain the progress the club has made in the last three years.
"The preparation for next season has already begun.
"We will be trying to bring in new faces for the start of the season to enable us to have a good year when we kick off again in August.
"I don't want anybody here next season who doesn't want to be here and who isn't prepared to do what is asked of them."