Palmer, 38, who was drafted first overall in 2003, said he felt the time was right to walk away from football.
"Over the years, I've had teammates who decided to hang it up and I would ask them how they knew when it was time to walk away," Palmer wrote. "The answer was almost always the same: You just know.
"For me, that time is now. Why? Quite simply, I just know."
Palmer's career, in essence, ended Week 7 in London, when he broke his left arm against the Los Angeles Rams. Blaine Gabbert (five games) and Drew Stanton (four) started at quarterback for the rest of the season.
Palmer went 38-21-1 during five years in Arizona, which included leading the Cardinals to a 13-3 record and a spot in the NFC Championship Game during an MVP-caliber 2015 season. That was the furthest he went in the postseason.
Palmer finished his career with 46,247 yards, 294 touchdowns and 187 interceptions, with a career completion percentage of 62.5. He's 11th in career completions, 12th in passing yards and touchdown passes, and 14th in attempts.
Palmer won the Heisman Trophy for USC in 2002 and threw for Hall of Fame-caliber numbers in the NFL, but his 15 years were marred by injuries, disagreements with management and playing for bad teams.
Palmer threatened to retire from the Bengals in 2011 after requesting a trade that wasn't immediately granted. Palmer began to go through with his threat, and sat out the first six games of the season before Cincinnati sent him to the Raiders. Palmer finished the 2011 season in Oakland and played there in 2012 before the Raiders traded him to the Cardinals in April 2013.
In Arizona, Palmer doubled his number of career playoff games from two to four and had the best season in 2015, when he threw for a career-high 4,671 yards and 35 touchdowns.
Palmer had two major knee injuries in his career, tearing the ACL in his left knee twice, once in 2006 and again in 2014. He missed 42 games during his career, not counting the 16 he spent on the bench his rookie year.
Palmer will retire fourth in Cardinals history in passing yard and touchdowns. He owns the franchise records for passing yards and passing touchdowns in a season, both set in 2015.