The 28-year-old missed 10 games due to concussions throughout his career but he didn't explicitly state that head injuries contributed to his unexpected decision to walk away from the NFL.
"There's only one way to play this game since I was a little kid - play fast, play physical, and play strong," he said in a video posted by the team. "And at this point, I don't know if I am able to do that anymore and that's the part that is the most difficult. I still want to play, but I don't think it's the right decision."
Kuechly, a first-round pick of the Panthers in 2012 out of Boston College, was named to his seventh consecutive Pro Bowl and All-Pro team at the end of the regular season. He was the NFL Defensive Rookie of the Year in 2012 and the NFL Defensive Player of the Year in 2013.
His 18 interceptions since entering the league ranks first among linebackers, as do his 1,092 tackles.
"While I wish we could have him for many more years, he has done everything the right way and we respect the decision that he's made," Panthers owner David Tepper said. "Luke is a once-in-a-generation player and someone we want every member of this organization to emulate."
Kuechly had two years left on his contract and was due to make north of $10 million in base salary in 2020.