The 23-year-old centre-half made 136 appearances for the Bees, including 40 starts during their Conference title-winning campaign last season.
Boss Martin Allen told the club website: “David Stephens has rejected the club’s offer of a new contract, and after lengthy discussions with the chairman last night we have decided not to change the offer.
“Dave will now not be signing for Barnet and we will be seeking compensation.
“Dave has been a tremendous player for us and I have really enjoyed working with him. He will always have a special place back here at Barnet and also for me.
“He was one of the key players in taking us back into the Football League and I am sure that Dave has a bright future and career ahead of him and it has been an absolute pleasure to work with him on and off the field. It is a disappointment to lose him but we have to move on.”
Allen has also handed veteran defender Michael Nelson a trial in a bid to win a contract with the Bees.