As revealed by AFL.com.au on Wednesday, Fremantle was the most likely destination for the midfielder if he chose to leave the Demons.
Sylvia told the Demons of his decision at AAMI Park on Thursday morning before thanking the club and saying he would always consider himself a "Melbourne person".
He said Fremantle was a good fit "based on where I’m at with my football career".
"This is the hardest decision I’ve made in my footy career to leave a club after 10 years," he said.
"The Melbourne Football Club will always be in my heart. It has made me who I am today and I thank for them for that.
"I would also like to thank my teammates over my journey at the club and the Melbourne supporters, they have been great for me and it’s really sad to leave.
"I leave on good terms and clearly this was a tough decision, given the positive moves the club has made in recent times."
Melbourne football manager Josh Mahoney said the Demons had offered Sylvia a contract that they believed was of similar terms to the Fremantle offer.
He said the club understood Sylvia's decision and would move on quickly.
"As an unrestricted free agent, he had a choice to make," Mahoney said.
"We thank Colin for his time at Melbourne and wish him well for the future.
"As we have already stated, we are aiming to bolster our midfield depth with experienced midfielders and Colin’s decision today allows us to create more flexibility with potential targets."
Sylvia shapes as a strong inclusion for the Dockers, who have been prepared to use free agency to fill gaps under coach Ross Lyon.
He has kicked 129 goals in 157 games with Melbourne and had a very consistent year in 2013, playing 19 games and finishing fifth in the club's best and fairest.
