The 37-year-old told Australia's Nine Network that he wanted to spend more time with his family.
Hussey is the second seasoned Australia batsman to retire in a month after former captain Ricky Ponting called it a day following the third test match against South Africa in Perth.
Dubbed "Mr Cricket" for his love of the game and meticulous attention to detail, Hussey has been in top form, scoring three centuries in his last five tests.
He has 6183 runs at an average of 51.52 from 78 tests and has also played 185 one-day and 38 Twenty20 internationals.
Already struggling with a raft of injuries to key bowlers, Australia will need to blood a new batsman in time for the tour of India in February and March before back-to-back Ashes series against England in 2013.
