The 79-year-old revealed that he has grown tired of the profession in recent years and has consequently decided to leave his days on screen and on stage behind.
"It is time for me to chuck in the sponge," O'Toole said in a statement. "To retire from films and stage. The heart for it has gone out of me - it won't come back.
"My professional acting life, stage and screen, has brought me public support, emotional fulfilment and material comfort. It has brought me together with fine people, good companions with whom I've shared the inevitable lot of all actors - flops and hits.
"However, it's my belief that one should decide for oneself when it is time to end one's stay. So I bid the profession a dry-eyed and profoundly grateful farewell."
The actor has been nominated for eight Academy Awards over the course of his lifetime, all in the 'Best Actor' category, making him the most-nominated actor never to win the accolade.
He is perhaps most famous for his role in Lawrence of Arabia, though he has appeared in countless films over the years.
Michael Fassbender recently said that he modelled his character in Prometheus on O'Toole's character from Lawrence of Arabia.
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