It is the latest and potentially most devastating blow for a once mighty club who have lurched from one crisis to another, culminating in a rancorous season in which they finished second from bottom of the championship and were torn apart by internal strife.
Fraser, the most successful Test bowler in his home county's history, has turned down Middlesex's offer of a new improved two-year contract even though their levels of pay have been increased by the introduction of a remuneration committee, headed by Fraser's close friend and benefit committee chairman Simon Dyson, following last winter's revelations that their players were among the most poorly paid in the country.
``I am looking at my options,'' said Fraser. ``We had a very unhappy year and I was upset by a few things that went on at Middlesex. It's not just financial. I'm worried where the club are going. I just feel I've got three or four good years left in me and I want to see if there's a place where I can enjoy my cricket more and, hopefully, compete for a couple more trophies. It's the hardest decision of my life.''
Fraser had always intended to play for Middlesex for at least one more season after his benefit year - and negotiated his contract accordingly - as he had been disturbed by the frequency with which past players had left straight after their lucrative 'golden handshake'. He has now done that, after enjoying a successful benefit in 1997, and says ``nothing happened last season to make me think I should now stay for the rest of my career''.
Middlesex have not given up hope of persuading Fraser to change his mind and last week he was invited for one-to-one talks with Mike Gatting, the newly appointed director of cricket, and captain Mark Ramprakash. But as yet the pair have failed to convince him that they can turn around the fortunes of a side who have not won a major honour since 1993 and who have struggled to replace the members of that year's championship-winning team. Only Fraser, Ramprakash, who had a torrid first full season at the helm after following Gatting and Mike Brearley as captain, and Phil Tufnell of their 1993 stalwarts remain at Lord's.
There is also, now, the hardly appetising prospect of Second Division one-day cricket for Middlesex, traditional under-achievers in the shorter game, to face next year when the new National League is introduced.
The club's decline came to a head last summer when John Buchanan, the successful coach of Queensland, was forced out of Middlesex by senior staff who refused to give his innovative, very Australian, methods a chance in the intransigent world of county cricket. The county say Buchanan was released after just one year at Lord's. The disillusioned Australian was unlikely to return in any case.
Buchanan's departure was followed by a stinging rebuke in which he criticised the English game in general and named Gatting and Ramprakash as the staunchest in their resistance at Middlesex.
Asked if the problems in county cricket were the reason for England's Ashes drought since Australia's triumph in 1989, Buchanan replied: ``I have no doubt about that. Because what England are drawing on at the moment is a squad of 18 to 20 players who can really play, not necessarily consistently, at Test level, whereas they should be drawing on something like 40 to 60 players.''
Buchanan, whose methods are based around computer analysis and in-depth team meetings, added: ``The big thing you notice in England is the approach of players. In England you've got paid players, and out here in Australia we've got unpaid players. But out here we've got professionalism and in England there's no professionalism, or very little.
``There's a certain brand of players and they're the ones who have risen to the top and are playing for England. The rest are struggling to come to grips with what it means to be professional in your approach, what it requires to be a first-class cricketer or beyond. And, as a consequence, the whole first-class system is impacted by that and the overall standard of the cricket played is far below what we play in Australia.''
The affair reached a climax with the resignation of Bob Gale as chairman of cricket at the same committee meeting at which Buchanan's fate was sealed. He has been replaced by Andrew Miller, a former Middlesex batsman and another friend of Fraser, who is known to have many sympathies with Buchanan's frustrations.
The county now can only hope that Fraser's friends are able to persuade him that he should see out his days as a one-county man in the changing world of the English game where 'transfers' are becoming ever more common.