The winger confirmed the news in an emotional video posted to social media, reflecting on his journey through the sport and thanking those who supported him along the way.
"Today is one of those difficult days for any footballer. The time has come to say goodbye to professional football," Tello said at the start of his message.
Tello came through Barcelona's La Masia academy, having previously spent time at Damm and Espanyol during his formative years, before breaking into the first team under Pep Guardiola in the 2011-12 season.
He went on to make 86 appearances and score 20 goals for the Catalan club, winning a La Liga title, a Copa del Rey and a Spanish Super Cup before leaving Camp Nou in 2014.
His career subsequently took in spells at Porto and Fiorentina, before a return to Spain with Real Betis, where he spent five seasons and won another Copa del Rey. He later moved to Los Angeles FC, Al-Fateh and Al-Orobah, before a final chapter in the United Arab Emirates brought his 16-year professional career to a close.
Tello admitted he had never imagined enjoying such a long career at the top level of the sport he loved.
"I could never have imagined I would get to enjoy what I love most at the highest level for 16 years," he said, adding that he leaves satisfied with everything he experienced on the pitch and proud to have shared dressing rooms with some of the game's biggest names.
"I consider myself truly privileged," the now-former player said, while acknowledging that not everything had been straightforward along the way. He explained that the more difficult moments in his career had helped shape him into the person he is today, and that he now looks ahead to a new chapter away from competition.
"A new stage begins, different in my life, without that hunger to compete, but with the same happiness," he said.
Tello reserved special thanks for his family in his farewell message, crediting his wife and daughters for their role throughout his career.
"I'm certain that without them by my side I wouldn't have enjoyed all of this as much. They have been my driving force throughout this whole story," he said.
He also thanked his friends and wider family, with a particular mention for his father.
"I'm very happy because he was able to fulfil his dream of seeing me enjoy doing what I loved most," Tello said, before thanking every club that had been part of his professional journey.