General Manager Jim Rutherford said Daniels will take a position in the hockey operations department, assisting with player and prospect development.
Daniels, 35, spent five of the last six seasons with the Hurricanes. In 2002-03, he had four assists and eight penalty minutes in 59 games.
"I've enjoyed my time as a player with the Hurricanes and I look forward to this new opportunity with the organization," Daniels said. "I'd also like to thank my teammates and the staff for everything over the last five years. The game has been good to me and I leave with no regrets."
Daniels was a sixth round draft pick by Pittsburgh in 1986. He had 17 goals, 26 assists, and 83 penalty minutes in 272 career games. He also played 334 games in the now-defunct International Hockey League, collecting 115 goals and 157 assists.