Former New Zealand scrum-half Justin Marshall announced the decision in the build up to what could be his final game this weekend.
A Magners League winner in 2007, Marshall played for the Ospreys between 2006 and 2008, joining from English side Leeds and departing for French Top 14 outfit Montpellier.
Marshall made close to 30 appearances for the Welsh region despite the signing of Wales and Lions scrum-half Mike Phillips.
The 36-year-old has been plying his trade across the River Severn with Saracens for the past 18 months, helping the club reach the Guinness Premiership semi-finals this season. And while the Ospreys are preparing for Friday's Magners League Play-Off with Glasgow, Marshall is all set for Sunday's semi-final trip to Northampton Saints.
"I have given a lot to the game over the past 17 seasons, but rugby has given me much, much more," said Marshall.
"When I was 19, I was in danger of going off the rails, but I was given a chance to move to Christchurch and play for Canterbury.
"Later that year, I was picked for the All Blacks and this incredible journey began.
"I have been so fortunate to make so many friends in this game all around the world.
"It has never been dull, and I have to thank my wife Nicolle and my children for supporting me during this period. My career has made massive demands on them, and now we are all looking forward to going home to New Zealand and settling into something like a normal family life.
"I just feel immensely grateful to all the talented players and coaches who have made my career so enjoyable and memorable."
Marshall is the All Blacks' most-capped No9 with a total of 81 Test appearances. He scored 24 tries during that time and featured in two World Cups.
He played a key role in New Zealand's 2005 whitewash of the Lions, starting the first Test in Christchurch before coming on as a replacement for Byron Keheller in the second and third internationals.
Marshall may soon be lost to the playing side of the game but he does intend to stay involved in the sport by starting a new television career with Sky Sports in New Zealand next month as well as continuing to work with Saracens.
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