Taylor's 6,533 runs in 226 appearances across all formats places her second on England's all-time list, while she is widely regarded as one of the best wicketkeepers in the world.
The 30-year-old, part of England's victorious World Cup team in 2017, withdrew midway through the recent Ashes series.
In recent years she has missed a number of series due to mental health issues.
"This has been a tough decision but I know it's the right one, for me and for my health moving forward," said Taylor, who made her international debut in 2006.
"I can't thank my teammates enough, both past and present, and the ECB (England and Wales Cricket Board) for being supporters and friends along my journey.
"Playing for England and getting to wear the shirt for so long has been a dream come true and I have been blessed with so many great moments throughout my career."