Pau Gasol (L) with Kobe Bryant (C) and Derek Fisher (R) after the Lakers NBA win in 2010 AFP
Centre Gasol, the older brother of Memphis Grizzlies' Marc Gasol, won the competition in 2009 as well as a year later during his time at the Los Angeles Lakers.
In 2019 he suffered a foot injury which threatened to end his career earlier than planned.
"It is a difficult decision. As you can imagine, it is difficult, after so many years, but it is a considered decision, you have to change gear a little, and know how to enjoy it," Gasol told reporters at a press conference in Barcelona.
"I wanted to end up playing and enjoying myself, not on crutches and with operations," he added.
He was a six-time NBA All-Star after being named the league's Rookie of the Year in 2002.
For Spain, Gasol, who also had spells with the Grizzlies, the Chicago Bulls, the San Antonio Spurs and the Milwaukee Bucks, claimed two Olympic silver medals and a bronze as well as three EuroBasket crowns.
His last international appearance came at this summer's Games in Tokyo during the quarter-final defeat to the US.
He finished his club career with a Liga ACB title in Spain in June while with hometown club Barcelona but failed to clinch the EuroLeague.
"I am thankful to all. Having won one more league with Barca," he said.