The striker has missed several training sessions with Brescia since the lockdown restrictions were eased in Italy.
According to Corriere di Brescia, Balotelli presented a medical note to the club on Wednesday excusing him from training for the next six days as he was suffering from stomach flu, which was the final straw for Brescia owner Massimo Cellino.
Italian news agency Ansa report that Brescia believe they have just cause to terminate his contract.
The report said Balotelli was offered a consensual termination, which he refused, and the club then sent a letter to his lawyer saying his contract would be ended.
"I thought that by playing in his own city he could give so much," Lopez told Corriere della Sera.
"He had so much to give but he should have done a lot more. These are the facts. So, it is normal I'm disappointed. I've spent a lot [of energy] on Mario but I wanted and demanded the same from him.
"The team took one path and he has taken another. During the quarantine, we haven't seen him on Zoom [sessions]. Even if he says he is well, he is not at the level of his teammates."
His contract has a get-out clause for the end of the campaign if Brescia are relegated to Serie B.
Ahead of Serie resuming on June 20 after three months of suspension, Brescia are bottom of the table with 16 points, nine from safety with 12 games remaining.
Information from Reuters contributed to this report.