The 34-year-old clinched a sixth Premier League title with the Red Devils this season and admitted after Sunday's final home game that he was keen to sign a new contract at Old Trafford.
Ferdinand last played for England in June 2011 and has remained in the international wilderness since Roy Hodgson took charge last year - missing out on Euro 2012 and then pulling out of the squad when eventually recalled for the 2014 World Cup qualifiers in March.
"After a great deal of thought, I have decided the time is right for me to retire from international football," said Ferdinand, who regularly undergoes injections in his spine to keep a persistent back problem at bay.
"At the age of 34, I feel it is right for me to stand aside and let the younger players come through, which allows me to concentrate on my club career. The team looks in great shape and there is an influx of young, talented players coming through the ranks which bodes well for the future.
"I regard it as a great honour and a privilege to have represented my country at every level from U17s upwards. I have always been very proud to play for England. I would like to wish Roy and the team all the best for future tournaments.
"A big thank you to all the fans, managers, coaching staff and players that I have worked alongside - the journey has been incredible."
Ferdinand became the youngest defender to ever play for England when he made his debut against Cameroon at Wembley in 1997 having just turned 19.
England boss Hodgson was quick to heap praise on Ferdinand, despite the defender never featuring in his side.
He said: "It is important to pay tribute to someone of Rio's stature and the achievements he had in a senior international career with England over 14 years at the highest level.
"To have captained his country, to play at three World Cups and indeed score in one of those, marks him out amongst a very special group of players.
"I appreciated the call from Rio to inform me of his decision, which clearly he had spent much time considering before reaching this point.
"I wish him all the best in his club career, and I'm sure the former managers he played under and every England fan will join me in thanking him for his service."