By releasing McPhee and Demps, the Bears have approximately $62.7 million in salary cap space with two-plus weeks before free agency begins on March 14.
Cutting McPhee results in about $7.1 million in cap space and shedding Demps gives the Bears about $3 million in cap space.
The Bears signed McPhee to a five-year contract in 2015 after he spent his first four seasons with the Baltimore Ravens. The 29-year-old led the team with 18 quarterback hits in 2015 but began the 2016 season on the physically unable to perform list with a knee injury.
Last season, McPhee started five of his 13 games before suffering a shoulder injury in Week 15. He recorded 21 tackles and four sacks in those games.
In three seasons with Chicago, McPhee appeared in 36 games and recorded 90 tackles and 14 sacks. He recorded a career best 53 tackles in his first campaign for the Bears but only 37 in 22 games in the next two seasons.
In 96 regular-season games with Baltimore and Chicago, McPhee has 182 tackles and 31 sacks.
Demps, 32, signed a three-year contract with Chicago in March but lasted only three games. He was placed on injured reserve after fracturing his left forearm in a Week 3 win over the Pittsburgh Steelers.
Demps posted his best seasons with the Houston Texans in 2015 and 2016 when he totaled 116 tackles and seven interceptions.
Since entering the league as Philadelphia's fourth-round pick from Texas-El Paso in 2008, Demps has 275 tackles and 18 interceptions in 110 regular-season games for Philadelphia, Houston, Kansas City, New York Giants and Chicago.