The 35-year-old former Atletico Madrid, Liverpool, Chelsea and AC Milan forward told a news conference that he would bring down the curtain on his career after his Sagan Tosu hosted the Vissel Kobe side of his fellow World Cup winners on Aug. 23.
"The reason is just personal," he said. "I feel that physically and mentally I'm coming to a stage, where the time when I will not able to perform at the level I want is approaching, and I don’t want to be there when it arrives.
"I don’t want to look back in a few years and see myself playing in a level I don’t want to, so it was an easy (decision)."
Torres, who scored the winning goal in the 2008 European Championship final before helping Spain win their first World Cup in 2010, said he would be returning home after his retirement but beyond that, his future plans were unclear.
"I think I need time to be away from daily football, it’s been so many years ... training every day and playing at the highest level every day," he added.
"So I just need time to spend with my family and think about the next step. I don’t know if it will be coaching or managing."
Torres scored more than 100 goals over two spells at Atletico Madrid and said he hoped that he could make his boyhood club part of his future at some stage.
"Atletico Madrid is my life so probably there will be a way for us to link up somehow in the future, but not immediately," he added.
"What I’d like to do with Atletico, if I have a chance to go back, will be something so big that I'll need training for it," he said.
"I'll need to study and understand perfectly how it works, so I will not be back just as a face on show. If I go back it will be a big role, to take the club to the next level."
Torres's time in Japan has not been an unqualified success and Sagan Tosu narrowly avoided relegation in his first season. They are currently bottom of the J.League with four wins from 16 matches.
Citing his pride at having scored the goal that kept Tosu up last season, Torres said he would do everything he could to help their cause before retiring and that he would continue to act as an advisor to the club board afterwards.
"I want to really (have) an intense last two months I'll give everything that is left inside of me to help the team to improve the current situation, which is not the best," he said.
The match against Iniesta and Villa's Vissel will kick off matchday 24 of the 31-round J.League on a Friday night at Tosu's home ground.
"I tried to find an iconic moment to play my final game and I guess that's perfect timing," Torres said.
"To say goodbye to football next to my dear friends is something that I could never imagine, and Japan is going to make it possible."
