The 33 year-old hangs up the boots as a free agent after leaving AEL Limassol in January.
Kacaniklic played for Hajduk Split, Liverpool, Fulham, Watford and Burnley, FC Copenhagen and FC Nantes.
The Swede told Sportbladet: "I feel like it's time. I'm completely healthy now and there are no problems at all, but the last two years have been marred by some injuries and it's been frustrating not to play. At the same time, I feel like I've experienced everything I dreamed of as a young man.
"It's just with joy and a smile. I've experienced wonderful things during my football career, met fantastic people and made friends for life."
The time with Sweden was special for Kacaniklic.
"Having been able to represent Sweden is the best thing you can do as a Swedish football player. I especially remember the debut against Brazil in the last match at Råsunda, the inauguration of Friends when Zlatan scored the bicycle goal, my debut goal against the Faroe Islands away and then the match after that.
"The feat in Berlin, where we pulled 0-4 to 4-4 against Germany. It was impressive."