Liverpool FC said the Reds captain will bring the curtain down on a glittering Anfield career that has spanned nearly 17 years and included 10 trophies, as well as 695 appearances and 180 goals to date since joining the club's youth system aged eight.
"Gerrard will not retire from professional football at the conclusion of the 2014-15 season. No decision on his new club has been made yet, but he will continue his career outside the United Kingdom and at a side that will not bring him into direct competition with Liverpool," added the statement.
The 34-year-old admits it is with a heavy heart he will depart Liverpool, describing the decision as the "toughest of his life", but has chosen to make it now to avoid speculation about his future.
Gerrard said: "This has been the toughest decision of my life and one which both me and my family have agonized over for a good deal of time.
"I am making the announcement now so that the manager and the team are not distracted by stories or speculation about my future.
"Liverpool Football Club has been such a huge part of all our lives for so long and saying goodbye is going to be difficult, but I feel it's something that's in the best interests of all involved, including my family and the club itself.
"I'm going to carry on playing and although I can't confirm at this stage where that will be, I can say it will be somewhere that means I won't be playing for a competing club and will not therefore be lining up against Liverpool - that is something I could never contemplate.
"My decision is completely based on my wish to experience something different in my career and life and I also want to make sure that I have no regrets when my playing career is eventually over.
"I can't thank Brendan, the owners and everyone at the club enough for how they've handled this and I am leaving on great terms. Also, I would like to thank my teammates and all the staff for their help and continued support.
"It is a very special place to be part of. It is my sincere hope and wish that one day I can return to serve Liverpool again, in whatever capacity best helps the club.
"One point that is important to make is that from now until the last kick of the last game of the season, I will be as fully committed to the team as I ever have been and giving everything I have to help Liverpool win games.
"My final message is for the people who make Liverpool Football Club the greatest in the world - the supporters.
"It has been a privilege to represent you, as a player and as captain. I have cherished every second of it and it is my sincere wish to finish this season and my Liverpool career on a high."
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