"This has been the toughest decision of my life, one both me and my family have agonised over for a good deal of time," Gerrard said in a statement released this morning.
"From now until the last kick of the last game of the season, I’ll be as fully committed to the team as I ever have been.
"I am making the announcement now so that the manager and the team are not distracted by stories or speculation about my future."
Gerrard, who will be 35 in May, says he will not be retiring, and will continue his playing career elsewhere next season - but it won't be at a Premier League club. It is expected he will move to the MLS in the summer, with Los Angeles Galaxy and New York FC interested.
"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."
"It is my sincere hope and wish that one day I can return to serve Liverpool again, in whatever capacity best helps the club."
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
Gerrard won one Champions League, one Uefa Cup, two FA Cups, three League Cups, one Community Shield and two Uefa Super Cups with the club in an illustrious 26-year career at Anfield.
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