There has been consistent talk surrounding Kroos' future over the last few months with his contract expiring in June, but the German international has now made the decision to end his career.
“July 17th, 2014 - the day of my presentation at Real Madrid, the day that changed my life. My life as a footballer - but especially as a person. It was the start of a new chapter at the biggest club in the world," he said in a statement.
"After 10 years, at the end of the season this chapter comes to an end. I will never forget that insolent successful time! I would particularly like to thank everyone that welcomed me with an open heart and trusted me. But especially I would like to thank you, dear Madridistas, for your affection and your love from the first day until the last one.
"At the same time this decision means that my career as an active footballer will end this summer after the Euro championship.
“I am happy and proud, that in my mind I found the right timing for my decision and that I could choose it by my own. My ambition was always to finish my career at the peak of my performance level. From now on there is only one leading thought: a por la 15!!! HALA MADRID Y NADA MAS!”
Kroos has made 463 appearances for Madrid since joining in 2014 and will leave as one of the most decorated players in the club's 120-year history, winning more than 20 trophies, including four Champions Leagues and four LaLiga crowns.
In addition to his titles with Real, the midfielder won the 2014 World Cup with Germany and another Champions League title with Bayern Munich in 2013.
Kroos announced his return to the Germany side after three years of international retirement and ahead of the June-July European Championship on home soil.
Real also issued a lengthy statement praising Kroos and his legacy with the club.
"Real Madrid would like to express their gratitude and affection to Toni Kroos, a player who is already part of Real Madrid's history and who is one of the great legends of our club and of world football," the club said.
"Toni Kroos will forever remain in the hearts of all Madridistas for the excellence of his football and for being a player who has given everything for this shirt, always representing the values of Real Madrid."
His final game for Real Madrid will come in the Champions League final against Borussia Dortmund at Wembley Stadium,