Former Australian Test and one-day cricket captain Ricky Ponting has announced he will retire from all forms of the game in October.

Ponting retired from international cricket after the Perth Test against South Africa last December, but continued playing with his state side Tasmania, IPL club the Mumbai Indians and Surrey in English cricket.

The 38-year-old says he will stop playing altogether after the Champions League Twenty20 tournament in October.

"While I'm enjoying my cricket as much as ever, it just feels like the right time to finish playing," he told reporters in England.

My body and mind are in great shape and I know I'm going to really enjoy these last few months before the next stage of life begins."

He says winning the Sheffield Shield with Tasmania last summer was the perfect way to farewell Australian fans.

"It's one of a lifetime of memories that will become even more special to me in retirement," he said.

I'm so grateful for the opportunities that the game of cricket has given to me."

Ponting retires as the second highest run scorer in Test history, with 13,378 runs in 168 matches over 17 years of international cricket.

Australian captain Michael Clarke has praised his predecessor.

"He's been an amazing player, there's no doubt about it, and [he's] done so much for the game of cricket," he said.

Tasmanian Cricket Association chief, David Johnstone, says it is a big loss to the sport.

"He was the Sheffield Shield Player of the Year last year so obviously he's still in very, very, good form at that level of cricket," he said.

"He's going to be a considerable loss from a point as a batsman, but also he'll be a loss around the team mentoring young players and giving his knowledge to the rest of the team.

"We would have loved him to play in all forms of the game for Tasmania. Obviously he's got other options in his career and moving in a different direction."

The Launceston club which discovered the Mowbray boy says he ranks as one of the top two Australian cricketers.

The club's Simon Howard says Ponting will leave a massive legacy.

"He'll be remembered as our second greatest batsman behind Sir Donald that we've ever had and he will be remembered as a fighter, a good leader, a man amongst men," he said.

A childhood mentor and family friend Mick Sellars says Ponting had enormous talent from a very young age.

He remembers Ponting padding up for Mowbray when he was nine or 10.

"He was only a short little fella. We always knew he had ability as soon as the first day he got to training," he said.

"Under-13's he played the first five innings, he got five hundreds and he had an average 120 for the week." (Source: ABC news)