The 37-year-old former Arsenal striker left the New York Red Bulls at the start of the month after they were knocked out of the MLS play-offs, but there was speculation he might choose to play on at another club - with a return to the Gunners mooted.
However, the former France international and World Cup winner has instead called time on a trophy-laden career which included spells with Monaco, Juventus, Arsenal, Barcelona and the Red Bulls.
In a statement released to Press Association Sport, Henry said: "After 20 years in the game I have decided to retire from professional football
It has been an incredible journey and I would like to thank all the fans, team mates and individuals involved with AS Monaco, Juventus, Arsenal FC, FC Barcelona, the New York Red Bulls and of course the French National Team that have made my time in the game so special.
"It is now time for a different career path and I am pleased to say that I will be returning to London and joining Sky Sports
I will hopefully share some of the insights, observations and experiences I have learnt over the years with you guys.
"I have had some amazing memories (mostly good!) and a wonderful experience.
"I hope you have enjoyed watching as much as I have enjoyed taking part.
"See you on the other side..."
Henry will always be most closely associated with Arsenal, where he is the all-time goalscorer with 228 goals in 377 games across two different spells
Arsene Wenger, who had known him as a young player at Monaco, signed him from Juventus for Â£11million in 1999, and immediately shifted him from the wing to a central striking position.
His blend of pace and power made him one of the most feared forwards in English football, and Henry won the Premier League title twice with the Gunners, as well as the FA Cup three times.
Henry left Arsenal in 2007 and joined Barcelona, where he won the Champions League in 2009
He also added two La Liga titles, the Copa del Rey, Spanish Supercopa, UEFA Super Cup and FIFA Club World Cup to his honours list in three seasons at the Nou Camp.
His medal collection also includes a Ligue 1 title and Trophee des Champions with Monaco, his first professional club.
He spent the final five years of his playing career with the Red Bulls, returning to Arsenal to make four appearances on loan in early 2012.
With France, Henry scored 51 goals in 123 appearances - only Lilian Thuram has more caps with Les Bleus
He was a member of the 1998 World Cup winning squad, while also being a runner up in 2006
Henry was a European champion in 2000 and was part of the team that won the Confederations Cup in 2003.
Source : PA