The Puerto Rican-born rapper made the announcement on a video he posted on his social media as well as his website.
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His song 'Gasolina' recently has taken a new life on TikTok due to high gas prices.
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In a statement, he said, "Today, I'm announcing my retirement from music by giving you my best production and my best concert tour. I will say goodbye celebrating these 32 years of experience with this new collector's item, the album "Legendaddy". I'm going to give you all the styles that have defined me, in one single album."
Daddy Yankee did not say why he was retiring.