Lidstrom announced his retirement at a Joe Louis Arena news conference, joined by Red Wings owner Mike Ilitch and General Manager Ken Holland, The Detroit News reported.
"After 20 seasons I am announcing my retirement," Lidstrom said. "It's painfully obvious to me my strength and energy level are not rebounding quickly enough for me to continue to play. My drive and motivation are not where they need to be."
The News said Lidstrom's retirement will leave a big gap on the team's defense.
Lidstrom expressed gratitude to the Red Wings ownership, current and former coaches and players who he said had helped him in his hockey career since he moved here from Sweden at age 16.
"I never really wanted to leave Detroit," he said. "I always believed in this team and organization."
Lidstrom had been considering retirement since the end of the Red Wings' season April 20. The Nashville Predators eliminated the Wings in the first round of the playoffs.
Lidstrom had missed 11 games in March after suffering a severely bruised ankle. He had 34 points during the regular season, the lowest total for a full season of his career.
Lidstrom, whose two oldest sons will be playing hockey in Sweden in the fall, wants to return to his native Sweden, the News said.