Both Halliday and Urwin's current deals with City are due to expire in the summer, meaning the two players will officially leave the club at the start of July.
Halliday initially joined the Bantams on loan from Championship side Middlesbrough back in October before signing permanently until the end of the 2014/2015 season in January.
The Scotsman's made 32 appearances in total for Parkinson's men, scoring three times in the process.
Halliday will probably be most fondly remembered by City fans for the goal he netted at Stamford Bridge against Chelsea in the F.A Cup in front of 6,000 delirious Bradford supporters.
Urwin's time at Valley Parade begun when he signed for the club on the eve of last season after a period on trial.
The 21 year-old didn't feature for Parkinson's senior side throughout the campaign but he was named as an unused substitute on twenty-two occasions.
The duo are the third and four players to depart from Parkinson's squad from last season after Jason Kennedy, who has moved to Carlisle United, and Matthew Dolan.