Rafter not returning
Rafter, 30, a two-time US Open winner and twice runner-up at Wimbledon, made the announcement quietly in an open letter to the media -- a characteristic move for the modest tennisman.
The Australian has not played since his country's 2001 Davis Cup final loss to France, when he pulled out of the deciding singles match due to an arm injury.
But he had left open the possibility of returning to competition this year after recovering.
"I know it's been a while coming, but I am announcing my official retirement from professional tennis," Rafter said in his letter.
"After taking several months for my arm to recover from stress fracture injuries I sustained in late 2001, I wanted to make sure that besides gaining physical fitness, I still had the motivation to compete," he said.
"If I couldn't commit to giving 100 per cent to the game, then there would be no point in returning. By the end of 2002, the motivation just wasn't there and my decision was made," he said.
Rafter won the 1997 and 1998 US Open titles and briefly reached the top of the world rankings in July 1999. He finished runner-up at Wimbledon in 2000 and 2001 and played in two losing Davis Cup finals.
A popular ambassador for his country, Rafter was named Australian of the year in 2002.
But he said Friday he would always regret failing to win at Wimbledon or capturing a Davis Cup championship, "but that's sport, you win some and you lose some."
"However, I feel I can leave the game, satisfied with my achievements, knowing that I gave it my all."
Rafter said his focus would be on his home -- he and his partner Lara Feltham celebrated the birth of their first child in August -- and on "the new developments in my life" -- which include working with child charities run by members of his family.
"I haven't made any decisions about my future yet, and I'm not in any hurry. Now that I've officially retired, I feel like my mind is free to make decisions beyond competing in the tennis arena," he said.
Tributes quickly began pouring in, with fellow Australian and current world number one Lleyton Hewitt saying Rafter had inspired his passion for the game.
"He's still hitting the ball well enough to chop up a lot of guys on the tour," Hewitt said.
Another fellow Australian tennis star, Mark Philippoussis, shared Rafter's regret at missing out on Australia's 1999 Davis Cup win due to injury.
"That would have been the icing on his career. I would have liked to have seen him win the Davis Cup."
Davis Cup captain John Fitzgerald says Australian tennis would be the poorer without Rafter.
"The game was good to him, but he really contributed heavily to our sport and to his country which I'll always remember," he said.
Tennis greats were not the only ones paying tribute.
Australian Prime Minister John Howard said he was sad but not surprised by Rafter's decision.
"I want to say to you Pat, you've been a wonderful ornament of Australian tennis, a great sportsman, a role model in his demeanour to young sportsmen and women all around the country and all around the world," he said.