Army spokesman Col. Tom Collins tells Fox News that McChrystal has informed the office that handles retirements for the Army, which is the General Officer Management Office, that he intends to retire.
The Army has not received McChrystal's official paperwork. In that, he will include a date by which he would like to retire. Then he will go through a formal process leading to retirement.
In announcing McChrystal's ouster on Wednesday, President Barack Obama praised his long Army career but said his intemperate remarks in a magazine article that appeared last week could not be abided.
McChrystal apologized for the remarks in Rolling Stone magazine and flew to Washington last week to resign as commanding general of the war.
The Army has been McChrystal's only career.
McChrystal was promoted to the selective and coveted rank of four-star general last year. It is not clear whether McChrystal will be able to retain that rank in retirement. Under Army rules, generals need to serve three years as a four-star officer to retain that rank, with its prestige and retirement benefits.
The secretary of the Army can allow officers with as little as two years of service to keep their retirement rank, Collins said.
Three military and defense officials in Washington said Obama may use his power as commander in chief to allow McChrystal to keep all four stars. The officials spoke on condition of anonymity because McChrystal has not yet submitted his paperwork.
McChrystal was the Pentagon's choice to run the war following a year of Taliban advances in 2008 and early 2009. He replaced Gen. David McKiernan, also a four-star Army general, after McKiernan was fired for failing to apply the counterinsurgency strategy McChrystal represented. McKiernan retired from the Army almost immediately.
Fox News' Mike Emanuel and Justin Fishel and the Associated Press contributed to this report.