The 36-year-old ended his time in the sport after losing 7-6 (8/6), 3-6, 6-3 to Spain’s Roberto Bautista Agut in the St. Petersburg Open second round.
Youzhny reached number eight in the world rankings and played in two triumphant Davis Cup squads.
One of those made him a national hero when he came from two sets down in the fifth and final rubber of the 2002 final to beat France’s Paul-Henri Mathieu in Paris.
“If I played tennis on home courts only, I wouldn’t finish my career so early,” Youzhny said. “But I’m too tired to travel around the world.”
“I’m happy with the level of tennis that I performed today, but I have no plans to come back. I decided to quit and there’s no way back.”
Youzhny, the 2004 champion in Saint Petersburg, once spent 13 successive seasons in the world’s top 50 and claimed 31 top 10 wins.
Each victory was celebrated by a trademark salute of right hand to temple and a racquet balanced on his head.
“It’s a pleasure for me to play Mikhail’s last match,” Bautista Agut said. “He’s an outstanding fighter who always gives everything he has on the court.”
French Open runner-up Dominic Thiem, the top seed in Saint Petersburg, advanced into the quarter-finals with a straight-sets win over Germany’s Jan-Lennard Struff.
The 25-year-old Austrian, who is seeking his third title of 2018, won 7-6 (7/4), 6-4 in one hour and 33 minutes.
“It was a very interesting match, my first indoor match of the year against a very tough opponent,” said Thiem, playing for the first time since his epic 4-hour, 49-minute quarter-final defeat to Rafael Nadal at the US Open.
“He serves very hard, every first serve comes at almost 210 kilometres per hour. But I made it through, and I hope to perform better than three years ago when I was in the last four.”
Thiem will next face local favourite Daniil Medvedev, the eighth seed, who ousted Mikhail Kukushkin of Kazakhstan 6-3, 6-4.
Canada’s Denis Shapovalov, the seventh seed, battled into the quarter-finals with a hard-fought three-setter against Matteo Berrettini of Italy, 7-6 (8/6), 4-6, 6-0.
Shapovalov next faces Slovak Martin Kližan, the 2012 champion.