The 37-year-old has scored 11,493 runs in 145 Tests at an average of 51.66 since making his debut in 1997.
The former captain has admitted that it is the right time for him to retire.
"It was not an easy decision to make, given that it has been a great privilege and honour representing my country during the past 18 years," EuroSport quotes Jayawardene as saying.
"But I believe this is the right time."
Jayawardene has stated that he will continue to play one-day cricket for Sri Lanka.