In a statement Wednesday night, coach Mark Dantonio announced Bullough is suspended for the remainder of the season for a violation of team rules.
"It is extremely disappointing for all parties involved," Dantonio said. "We will stay focused and close ranks as we prepare for Stanford on January 1 in the Rose Bowl. Max will forever remain a Spartan and valued member in this team's achievements.
"We will have no further comment on this issue."
Per multiple reports, Bullough did not make the trip to California with the team on Christmas.
The three-year starter was named first-team All-Big Ten in 2013 with 76 tackles and 9.5 tackles for loss. He will finish his career ranked No. 18 in Michigan State history with 299 tackles and 11th with 30.5 tackles for loss.
Bullough was arrested during spring break in Colorado in 2011 with former Spartans tight end Brian Linthicum. Bullough was charged with a misdemeanor minor in possession of alcohol and sentenced to nine months probation. Since then the senior had not been in any reported legal trouble and had become a valuable member of the Spartan football team on and off the field.
He recently was in New York being honored by the NFF Foundation as a national scholar athlete with a 3.56 GPA in finance.