"It's a tough decision, I've thought about it a lot, and I think now is the right chance for me to move on," he said.
Kuechly was named to the Pro Bowl this season for the seventh straight time in eight years in the league. He has been first-team All-Pro five different times and was the Defensive Player of the Year in 2013.
The 2012 first-round pick led the league in combined tackles twice and was sixth among active players with 690 solo career tackles, while four of the five ahead of him entered the league at least five years before him.
He also had 12.5 sacks and 18 interceptions as one of the most impactful defenders of the past decade.
The 28-year-old started all 16 games for the Panthers this season and hasn't missed a game since 2017, but he has suffered multiple concussions and shoulder injuries in his career, including a torn labrum in 2015.
"There is only one way to play this game since I was a little kid is to play fast and play physical and play strong, and at this point I don't know if I'm able to do that anymore," he said. "That's the part that's the most difficult.
"I still want to play, but I don't think it's the right decision."