Spies has been without a club since the summer, with former club Montpellier not interested in renewing his contract.
Although he had impressed in the Top 14, Spies has failed to find a new club and he has decided to call it quits after a long and successful career.
He played 53 Tests for South Africa between 2006 and 2013 and Spies admits insists he enjoyed every minute of his career.
In a statement, he said: "As a professional rugby player, I have thought a lot about this day. It is a moment every player is destined for, and yet you cannot control how and when you accommodate it in your life.
"Much speculation has been going around the past two months about my rugby career and the way forward.
"This statement confirms my retirement from all forms of rugby. It has been a wonderful journey and one I will remember for the rest of my days, but it is the end of a chapter in my life.
"It is impossible to give credit to all people who contributed towards my career and please do not see an omission of any name as an absence of gratefulness on my part."