"It is with mixed feelings that I announce my retirement from Ulster Rugby as of the end of this season," said Best. "This feels like the right time for me to go out on my terms, a luxury for which I feel very privileged."
Since succeeding Paul O'Connell as captain in 2013, Best has skippered Ireland to three Six Nations titles, including the Grand Slam in 2018.
Best has featured in three World Cups and twice been selected for the British and Irish Lions, although he did not play a Test.
Ireland will begin their World Cup campaign in Pool A against Scotland on 22 September.
Best added: "I am very excited for the end of the season with Ulster and for the upcoming World Cup with Ireland - both of which I hope to finish with a massive high, playing at the top of my game."