Peacock, aged 31, needed a complete reconstruction of his knee last season and has now conceded that his playing career is over after damaging the joint again in the match at Castleford on Bank Holiday Monday.
The Bulls coach, Matthew Elliott, said: "It's been a difficult decision for him to make and I'm disappointed that he's been forced to make it, but it's a measure of the man that he didn't want to let the side down.
"The specialist has advised him to retire and the fact that he has three children has been a major part of his decision."
Peacock played 52 times for Bradford, scoring 22 tries including one in the 1997 Silk Cut Challenge Cup final. He now plans to return to Australia, leaving a gap on the Bulls' overseas quota that they will not find it easy to fill in mid-season.
Bradford are to break new ground for the game by playing the London Broncos at the Leicester Tigers' Welford Road ground this summer. The match, on Wednesday 28th July, will be the first time that rugby league has been played at the stadium.
Leicester's chief executive, Peter Wheeler, said: "This is another opportunity to see top class rugby at Welford Road. The idea of staging a quality match in the summer gives us a chance to get more use out of our stadium at a time when things are normally quiet."
The Leicester game is part of a double bill of matches outside the mainstream that week. The following Sunday, Gateshead are to play Wigan at the Hearts' football ground in Edinburgh.
An approach by Gateshead to sound out Alan Tait, the Scotland rugby union centre who played league for Widnes and Leeds, about a return to the game has failed because Tait is under contract to the Scottish Rugby Union. But, according to Gateshead's chief executive, Shane Richardson, he has agreed to do some scouting for the club in Scotland.
Keighley, who sacked their coach, Lee Crooks, last month, have delayed naming a successor, because their preferred candidate is still considering whether to accept the job.
Halifax's New Zealand Test forward, Gary Mercer, has been told that he can resume his career after a neck injury which has kept him out of action for eight weeks. Mercer could be in contention for a place against Hull on Sunday.
n The House of Commons' culture, media and sport committee is to undertake an inquiry into the future of both rugby codes. It will consider the financial state of both codes at professional level and the relationship between league and union.Reuse content