The Borussia Moenchengladbach defender, 33, who spent time at Middlesbrough, Liverpool and Tottenham, has not played since being injured last December.
Ziege had mixed feelings over his retirement, saying: "I'm sad my career as a player is ending. I'm happy that all the back and forth over injuries, rehabilitation, hopes and disappointments are finally over."
Ziege won 72 caps for the German national side, playing in their triumphant Euro 96 campaign and also in the 2002 World Cup final. He said: "I won championships in Germany and Italy, the UEFA Cup, the European Championship and was runner-up in the World Cup. There's not a lot more one can achieve in soccer."
Ziege also played for Bayern Munich and AC Milan before joining Boro and then making a controversial move to Anfield. His career in England finished at White Hart Lane before he returned to his homeland.
Copyright - BBC