The 33-year-old Vancouver Whitecaps frontman won the last of his 69 caps in the 3-2 defeat to England at Wembley last week and signed off with a goal - his 18th for his country.
The former Hibernian, Rangers, Celtic, Wolves and Cardiff striker hangs up his boots with only Kenny Dalglish, Denis Law, Hughie Gallacher, Lawrie Reilly and Ally McCoist ahead of him in the Dark Blues' list of all-time top scorers.
Miller's retirement was confirmed prior to Gordon Strachan naming his Scotland squad for the World Cup qualifying double-header against Belgium and Macedonia.
Strachan said: "Kenny is a talented player who absolutely gave the best of himself when he was on Scotland duty.
"In my time as national coach it has been a pleasure to have a player with his ability and experience in the squad.
"He has come to this decision to help prolong his club career, and feels that this is the best time to bow out.
"We understand his decision and wish him all the best for the future."
Miller began his career with Hibernian in 1998 and is only one of only five post war players to have played for both Rangers and Celtic, winning four Scottish titles, three of them with the Ibrox club.
He also won two Scottish Cups one with each of the Glasgow-based clubs.
He left Rangers for Turkish club Bursaspor in January 2011 but his 22 goals up to that point of the season was still enough to make him the SPL top scorer.
Later in Miller's career, he had a brief spell with Cardiff and helped them to the League Cup final in 2012 before signing with the Vancouver Whitecaps of the Major League Soccer where he recently signed a contract extension with the Canadian club until 2014.
He made his international debut in 2001 under Craig Brown and was a regular starter under future managers Berti Vogts, Walter Smith, Alex McLeish, George Burley, Craig Levein before playing his final match against England last week under current boss Gordon Strachan.
Leigh Griffiths will vie with Steven Fletcher and Jordan Rhodes to succeed Miller in the national side and the Wolves frontman was quick to pay tribute to his former team-mate.
He tweeted: "Sad to hear about Kenny miller, been a great servant to Scotland
for a number of years! So many important goals for Scotland! #topplayer."