"At the end of this season, I'll have spent 15 years as a professional rugby league player and the time is right for me to finish my career and begin a new chapter," he said.
"There is still plenty of work to be done in the remainder of the season and I'll be giving my all to try to help the team reach our goals."
McDermott is in his testimonial season at Leeds after joining them from Wigan in 1995 but he will not be severing his links when he hangs up his boots.
"He will have a role in our coaching and development programme from next season," said the club's chief executive, Gary Hetherington.
Hull KR have offered their coaching post, vacant since the sacking of Harvey Howard last month, to Justin Morgan, the man who has steered Toulouse into the semi-finals of the Challenge Cup.
Rovers hope for an answer from the Australian today, but Morgan is thought to want to remain in charge of the French side until after their semi-final against Leeds on 31 July.
"We've put an offer to him and we're obviously keen to get him on board, because he meets all the criteria we had in mind," said Hull's commercial director, Paul Lakin.
Bradford's Robbie Paul has broken a bone in his hand and will be out of action for a month.
Mike Wainwright is back in Warrington's squad for Saturday's game at Wigan after recovering from broken fingers.
Andrew Johns underlined his status as the world's best player by again inspiring New South Wales to a series-winning victory over Queensland.
Johns had an important role in NSW's first six tries as they won by 32-10 - a record for them in a State of Origin match in Brisbane.Reuse content