The footballing world has been quick to pay tribute to the 34-year-old midfielder, who won nine major honours with the Anfield club.
Mario Balotelli, who joined the Reds this summer from AC Milan wrote on Liverpool's official website today, comparing Gerrard to the great Italian midfielder Andrea Pirlo.
"Wow. I think of him as being at the same level as Pirlo. Vision, technique but he is powerful as well. Stevie can do anything, he's an amazing player. It's going to be very difficult for the team to find another player like him in the future."
Steven Gerrard in pictures
Steven Gerrard in pictures
1/11 England Under-21s
Steven Gerrard of England celebrates his 13th minute strike during the England v Luxembourg European 2000 Under-21 Qualifying match at the Madejski Stadium, Reading, England. The match finished in a 5-0 win for England
2/11 England 5 Germany 1
Gerrard celebrates his goal in the 5-1 win over Germany, one of his England highlights
3/11 Euro 2004 qualifiers
Gerrard celebrates after scoring the equaliser during the Euro 2004 European Championships Group 7 against Macedonia at St Mary's Stadium in Southampton, England
4/11 2006 World Cup qualifiers
Gerrard celebrates with Michael Owen during the FIFA World Cup 2006 group six qualification after scoring against Austria in Vienna
5/11 Beckham and Gerrard
David Beckham and Gerrard in England colours together. The pair were at the heart of England's 'golden generation'
6/11 Beckham and Gerrard
And now Gerrard could follow Beckham in a move to the MLS and LA Galaxy
7/11 Champions League success 2005
Gerrard captained Liverpool to their famous penalty shootout European Cup victory in 2005
8/11 England Player of the Year
Gerrard was named England player of the year in 2013
9/11 2014 World Cup
Gerrard captained his country to the 2014 Fifa World Cup in Brazil last summer
10/11 An early exit
But was unable to prevent defeats to Italy and Uruguay that paved the way to England's early exit from the tournament
11/11 International retirement
Gerrard would go on to announce his international retirement after the ill-fated trip to Brazil
The Liverpool manager, Brendan Rodgers said soon after the news was announced this morning:
"It is almost an impossible task to find the words to appropriately sum up Steven Gerrard and his importance to Liverpool.
"This is an era where the word 'legend' is vastly overused, but in his case it actually doesn't do him justice."
Jamie Carragher, his former team-mate at Liverpool, said it was a "sad day for Liverpool and football".
Sad day for Lfc & English football with the Gerrard news, I think it's the right decision all things considered.Jamie Carragher (@Carra23) January 1, 2015
Gary Lineker called Gerrard one of the "finest players to have graced the Premier League".
An era comes to the end with SG leaving LFC. I think he made the right call. What a career,what a player.Thx for the many wonderful moments.Didi Hamann (@DietmarHamann) January 2, 2015