Jorge Lorenzo will end his MotoGP career after the final race of the season on home soil Valencia this weekend.
Lorenzo, 32, called an "exceptional" press conference at the Circuit Ricardo Tormo on Thursday, when he announced that he is to quit as a professional rider after the Valencia Grand Prix.
The three-time MotoGP champion has endured a miserable injury-hit debut season with Repsol Honda, languishing way down in 19th in the riders' standings with only 25 points.
Lorenzo had one year remaining on his contract, but revealed injuries were the main reason for his decision to quit.
"I've always thought there are four significant days in the life of a rider; your first race, first win, first world championship, and then the day you retire," he said.
"I am here to announce that this day has arrived for me. This will by last race in MotoGP and after this race I will retire as a professional racer."
The Spaniard sustained a fractured backbone in practice at the Dutch TT in June, having also crashed in the Catalunya Grand Prix and suffered a post-race accident during testing in Barcelona.
Lorenzo decided his body had taken enough punishment and became increasingly frustrated with not being competitive.
"Unfortunately injuries came and played a big part in my results and performance, so I wasn't able to be in the physical condition to achieve the results I wanted and the bike did not feel well to me," he said.
"It gave me a lot of problems, not being as competitive as I want to be."
He added: "I have to admit when I was rolling on the gravel [at Assen], I thought to myself 'okay Jorge, is this really worth it after what I've achieved, to keep suffering?'. Then I came back home and decided to give it a try, I didn't want to make an early decision.
"I kept going, but the truth is from that moment the hill became so high, so big for me that I was not able to find the motivation, the patience to try to climb this mountain.
"You all I know I love to ride, I love competition, but above all I love to win. I realised at some point this was not possible and at this stage of my career it was impossible to have the motivation so my goal I put into my mind at the beginning of the season was not realistic."
Lorenzo was crowned world champion twice in the 250cc category before stepping up to win the premier class title in 2010, 2012 and 2015 for Yamaha.