"I've had the privilege to be a professional football player for almost 17 years now and I feel incredibly thankful for the opportunity.
"But in recent weeks and months, having also suffered some injuries, it's become more and more clear that it's time to leave the big stage of foootball," Ozil said in a statement, thanking his family and fans, adding that he's looking forward to spend more time with his wife and daughter.
Injuries have limited Ozil to just four league games for Basakshehir, where we moved after two seasons with Fenerbahce.
The German playmaker rose to prominence in his native Gelsenkirchen, playing for Schalke.
He then spent three years at Werder Bremen before joining the star-studded line-up at Real Madrid.
After winning a LaLiga title and leading the league in three straight seasons, he moved to Arsenal in a then-record transfer worth 50 million euros and helped the club win three FA Cups during his eight year stint.
Internationally, Ozil was eligible for both Turkey and Germany, and decided to play for the latter after a long consideration.
He made his senior debut for his birth country at age 20 and went on to appear at five major tournaments and score 23 goals in 92 appearances for Die Mannschaft.
Ozil was the top assist provider at the 2010 World Cup and Euro 2012 and helped his country win the 2014 World Cup.
He retired from the squad in 2018 amid a political debate in Germany about an influx of migrants and after backlash over a photograph taken with Turkish President Tayyip Erdogan, saying he faced "racism and disrespect" over his Turkish ancestry.
He was named German Player of the Year five times, which is a record.