Gibbs, who quit the Test arena in 2001 after winning 53 caps for Wales and featuring on three Lions tours, captained the Neath-Swansea Ospreys this season.
He also played rugby league for St Helens, enjoyed a 10-year Test career and scored the winning Welsh try which famously denied England Grand Slam glory at Wembley in 1999.
Gibbs, 33, said he has found it increasingly difficult combining rugby with his business career.
"What I had not fully appreciated when accepting a two-year contract with the Ospreys last summer was the effect of all the extra travelling, now that the Celtic League is played home and away," he said.
"Coupled with the Heineken Cup, it has meant I have been out of the country for long periods - and that has put a strain on my work.
"Something had to give. Ten years ago, rugby would have come first - but at my age, work had to be my priority.
"I told the Ospreys what was in my mind a couple of months ago. They wanted me to carry on until the end of the season, and my decision was no reflection on the coaching team or the management who are all first-class."
Gibbs believes he has stayed true to his principles in the way he has kept his club informed and retired at what he is sure is the right time.
"Honesty has been a theme running through my career," he said.
"I like to tell it as it is and I knew I would not do myself or the team justice by carrying on any longer.
"I am surprised at what I have achieved. I was amazed when I was first picked by Wales, and even more so when I made the Lions squad for New Zealand in 1993.
"I have never tended to think further ahead than the next game and I was never particularly ambitious. It was just a case of trying to do your best every week.
"It will be strange for a while, but the one thing you know as a sportsman is that your career will end when you are still young. There is a life beyond it, and that is where I am headed now," he told the Western Mail.