The South African-born 33-year-old has been kept out of the game with a stress fracture to his right tibia that continued to flare up each time he attempted a return.
Vickerman, acting on doctors' advice, announced his retirement at a media conference in Sydney.
"It is with sadness that I won't be playing anymore," Vickerman said.
"I've been pretty fortunate in my career over the last 10 to 12 years to have played for Sydney University, Waratahs, Brumbies and the Wallabies.
"I've thoroughly enjoyed my time - I never thought I'd play one Test for my country."
Vickerman represented South Africa at Under-19 level, but relocated to Australia where he turned out for the Australian Under-21s.
He made 33 appearances for the ACT Brumbies and played 53 matches for the NSW Waratahs.
Vickerman's final game for the Wallabies was against New Zealand in last year's Rugby World Cup semi-final - it was his 63rd game for Australia.
Playing against the All Blacks was always a highlight for Vickerman and the Wallabies could have done with his services against the Kiwis during this campaign. But Vickerman insists there are positive signs in the current Wallaby set-up.
"I think we're a young side - there aren't too many guys who are over 25 in that team. So from that perspective it's exciting to see this group move forward together," Vickerman said.
Vickerman has not been lost to the game completely - he's been working with Sydney University in a coaching and mentoring capacity.