Ellison, 31, missed the final six games of this past season because of a concussion. He had one year remaining on a four-year deal with the Giants.
"The past few weeks, it's kind of been an emotional roller coaster," Ellison said in a statement. "But the overwhelming feeling I have is gratitude. Just thinking back to all the people in my life, even before I put pads on, that were able to nurture and grow the gifts God put into me and make this career possible.
"I think that was the biggest thing that was the fun part about the retirement process, which is reflecting on those people, thanking those people, reaching out and just the lessons they taught me, the tools they gave me for my life after football."
He finishes his career with 118 receptions for 1,189 yards and seven touchdowns in 113 games.
He played the first four seasons of his career with the Minnesota Vikings, who selected him in the fourth round of the 2012 draft.
The Giants save $5 million against the salary cap with Ellison's decision.
ESPN's Jordan Raanan contributed to this report.