The former England striker, who made his first-team debut for Liverpool as a 17-year-old and also played for Real Madrid, Newcastle United and Manchester United, has almost disappeared from view at Stoke City for whom he signed last September.
"I now feel it is the right time to bring the curtain down on my career," the injury-prone 33-year-old said on his personal website.
"I have been very fortunate in that my career has taken me on a journey that like many young players starting out, I could only have dreamt of."
Diminutive Owen had already shown his potential at Liverpool when he thrust himself onto the world stage with a sensational solo goal against Argentina in a 1998 World Cup second round defeat in Saint-Etienne.
A natural striker with a devastating burst of pace, Owen went on to make 89 international appearances, scoring 40 goals to sit fourth on the all-time England goal-scorers' list.
Another famous England performance came in the 5-1 World Cup qualifying win in Germany in 2001 when he scored a hat-trick.
"It's sad news for football that Michael Owen will retire. He's been a fantastic football player for all the clubs he played for and for England," Sven Goran Eriksson, his England coach from 2001-06, told Britain's Sky Sports News TV.
"He was very easy to manage. First of all, he's a fantastic man - professional, never any problems on or off the pitch. If you had him in your team you knew that at any time he's a danger, he can score the winning goal.
"Beating Germany 5-1, that couldn't or shouldn't happen. It was one of those games you can never forget. I felt very proud to be the manager of Michael Owen."
In 297 appearances for Liverpool he scored 158 goals, making him one of the most sought-after strikers in the world, voted 2001 European Player of the Year and twice winning the Premier League's Golden Boot award.
In 2001 he helped the Reds win the FA Cup, with two late goals in the final to come back to beat Arsenal 2-1, as well as the League Cup and UEFA Cup.
Owen joined a star-studded Real Madrid team in 2004 and despite starting mainly as a substitute, he managed to score 16 goals in his only season at the Bernabeu before returning to English football with Newcastle.
The latter years of Owen's career have been marked by regular injury problems. After battling to recover from a broken foot to be fit for the 2006 World Cup finals, Owen suffered a serious knee injury in the first minute of a match against Sweden and missed almost a year.
"It is a great shame that Michael has decided to call time on his career, but he can look back with great pride and satisfaction of having contributed so much to the game, both at international level and domestically," English FA Chairman David Bernstein said in a statement.
"We hope Michael's experience is not lost to football."
Owen's free transfer move from Newcastle to Manchester United was a shock for fans of arch rivals Liverpool but apart from a hat-trick in the Champions League against Wolfsburg, it was clear that he had lost the acceleration that once terrorised defenders.
A first Premier League winner's medal was forthcoming though with United in 2010/11 and an injury-time winner in the 4-3 derby victory over Manchester City the season before will be forever remembered by United fans.
Since joining Stoke he has made only seven appearances, six of them as substitute, scoring one goal.
"Emotional day," Owen said on his Twitter site.
"I'm overwhelmed. So many nice messages. Having known it for a while I thought I would be OK. Reduced to tears."
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