The 37-year-old center, who had a year left on his contract, spent his entire career with the Red Wings, and he helped Detroit win the Stanley Cup in 2002 as a rookie. He was one of the franchise's stars when it won another title in 2008.
He plans to reunite with his teenage daughter and continue his career in the Russia-based Kontinental Hockey League.
"My family and I are grateful for our time here in Detroit," Datsyuk said at a news conference at his youth hockey camp in the Detroit area. "This was not an easy decision, but it is time for us to return home."
He said he came to grips with his decision during a recent family vacation, and he told Red Wings general manager Ken Holland on Friday night.
"It's difficult," said Datsyuk, a native of Sverdlovsk, Russia. "I fight with my mind already a few years."
Datsyuk, a four-time All-Star selection, had one year remaining on his contract that comes with a salary-cap charge of $7.5 million. Because it was signed after he was 35, the Red Wings will be stuck with that cap hit next season.
He ranks sixth in team history with 918 points, having scored 314 goals (ranked seventh) and tallied 604 assists (fifth) in 953 career games. In addition to the two Stanley Cup titles, Datsyuk has hoisted the Lady Byng Trophy -- for sportsmanship -- on four occasions, and the Selke Trophy -- given to the league's best defensive forward -- three times.
Datsyuk said he almost returned to Russia for good while playing there during the NHL lockout during the 2012-13 season.
"When I came back from lockout, my mind is thinking, I want to go home," Datsyuk said. "But also I want to keep playing here. I go with my mind and [was] OK with another three years, but then it got harder and harder.
"Now I just think it's not fair, and I have to go back home."
Information from The Associated Press was used in this report.