The 37-year-old defenseman, who joined the Red Wings as an unrestricted free agent in 2007, had one year remaining on his contract.
"At the end of the day it came down to priorities with the top three priorities being: serving God, serving my family, and serving others," Rafalski said at a news conference.
"With hockey not being at the top, it's time to move on."
Rafalski said back and knee injuries had also played a role in his decision.
"There wasn't a day this year where I wasn't on the training table," added the American, who missed 36 games in four seasons with the Red Wings. "That gets tiring. I wasn't able to skate the way I would like to."
Rafalski won his third Stanley Cup with Detroit in 2008. The other two came with the New Jersey Devils where he played seven seasons.
He had 79 goals and 515 points during 833 regular season games and added 29 goals and 100 points in 165 playoff contests.
He also was a member of the silver-medal winning 2002 and 2010 U.S. Olympic teams.
(Reporting by Gene Cherry in Raleigh; Editing by Mark Lamport-Stokes)