The 35-year-old Hyypia will make his 464th appearance for the club against Tottenham Hotspur on Sunday before moving to Bundesliga team Bayer Leverkusen.
"It's difficult to put into words. He's been fantastic for us - a colossus," Gerrard told Liverpool's website. "He certainly deserves legendary status and he's definitely one of the best players I've ever played with. They're the biggest compliments I can pay Sami."
Hyypia, an instantly recognisable figure at the heart of Liverpool's defence with his towering physique and blonde hair, has become marginalised by the emergence of Martin Skrtel and Daniel Agger as partners for Jamie Carragher.
After winning the Champions League, the UEFA Cup, two FA Cups and two League Cups, but not the Premier League title the club so craves, Hyypia said he was looking forward to a change.
"I am sad to miss that medal but I don't think I have anything to regret," the Finnish international said of Liverpool's near miss in the title race this year.
"Next season it might happen but I only play 10 games and I wouldn't get a medal anyway. I am sadder for the fans that Liverpool haven't won the Premier League than for myself.
"For 10 years I have played in the same league, in the same stadiums and against the same clubs mainly, so now I have a chance to go to Germany which is a good league."
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