Ganguly made his debut in international cricket in 1992 by being selected for the one-day team and later entered the Test format in 1996. He has also played 311 ODI matches.
Ganguly has scored 6,888 runs in the Tests, averaging 41.74 and 11,363 runs in ODIs at an average of 41.02.
His highest Test score was 239 and ODIs 183. In the latest shorter version of the game -- Twenty20 -- he scored 726 runs, at an average of 25.92, the highest being 91.
The new Chief Selector K Srikkanth said Ganguly had a chat with him before making the announcement.
"He had a chat with me and a co-selector. He probably feels it's time for him. Every now and then the axe was on him and he said 'Chika' let me play without any pressure on me," Srikkanth said.
"I pray he scores a lot of runs in the series and India wins. A guy like Sourav Ganguly deserves it because he has done a lot for this country," he added.
Former captain Bishan Singh Bedi said it was not a time to feel sad but to celebrate because Ganguly deserves a grand farewell.
"His contribution has been enormous. A great Indian cricketer, a legend has hung up his boots. I hope he has done it on his own terms," Bedi said.
Another former skipper Kapil Dev welcomed Ganguly's decision but felt nobody should put pressure on senior players to quit.
"Nobody talks about retirement of the Board officials but they only put pressure on seniors, who are great players and should leave on their own. Nobody but the players themselves should decide when to go," he said.
Venkatapathy Raju, a former selector who had played with him, said he was not shocked by the decision and felt it was right.