But as one door closes another opens and the 35-year-old will remain with Scottish Rugby as an assistant coach at Glasgow.
With 85 international appearances to his name, Blair is Scotland's most capped scrum-half and was named Scotland's Player of the Year in 2008, as well as being nominated for the IRB World Player of the Year that same season.
Having spent ten years with Edinburgh, Blair ran out for Brive and Newcastle Falcons before joining the Warriors this season, making 12 appearances and being named Player of the Month for October.
Speaking to glasgowwarriors.org Blair said: "It was always my intention to move into a coaching role and although there was an opportunity to play on next year, I believe now is the right time for me to make that change.
"I had originally planned to retire at the end of last season, but I'm glad Gregor (Townsend) persuaded me to play on at Glasgow. I've really enjoyed the season and it's a brilliant environment to be part of.
"With only a few games left this season, I have unfortunately run out of time to be able to regain my fitness before the end of this campaign.
"My recent spell on the sidelines has allowed me to start coaching earlier than expected, working with scrum-halves Henry Pyrgos, Grayson Hart and Ali Price, all of whom are currently playing very well.
"They have been a pleasure to work with and I look forward to working with them more as the season draws to a close and extending this role to the rest of the squad as we move into next season.
"I'm lucky to have had a long career and to have played with some amazing players and made life-long friends.
"I'll definitely miss the camaraderie on the pitch and in the changing room, but it's time to move on and a new challenge awaits."
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