Rumours of retirement had surrounded Rathbone over recent months but the former Brumbies star officially called an end to his playing days yesterday.
Rathbone suffered five fractures to his eye socket and cheekbone playing for club side Uni-Norths Owls in Canberra on Saturday and that latest setback appears to have finalised his decision to give up the game.
"I've decided to hang up the boots, it's all over," Rathbone told the Canberra Times.
"I need to look after my long-term health and when I couldn't agree with any of the contracts that were in front of me for next year, I figured it would be best to step aside."
The former South African Under 21 captain, who switched allegiance to Australia and went on to win 26 international caps, had been out of contract with the Brumbies but had received a number of offers to continue playing.
However, it is thought that Rathbone had only wished to sign a one-year contract and that such an offer was not forthcoming.