The right-arm seamer, who made his debut for the Black Caps in 2000 against South Africa, picked up 233 wickets from 71 Tests to sit behind Richard Hadlee (431) and Daniel Vettori (360) on the list of New Zealand's most successful Test bowlers.
"It feels like the right time to step down," Martin said in a New Zealand Cricket statement.
"I have loved every second and given it everything when playing for the Black Caps, but after 15 years of professional cricket, it's time to pursue a new challenge."
Martin, who also picked up 18 wickets in 20 one-day internationals, played his last Test against South Africa in January.
Not one to rely on pure speed, Martin's tight line and length made life difficult for top-order batsmen in conditions which assisted swing bowling.
His best bowling came against South Africa in 2004 when he won the man of the match award for his haul of 11 wickets in an Auckland Test.
Martin picked up five-wicket hauls on 10 occasions in Tests.
"The way Chris goes about his business both on and off the field has made him one of the most respected players in the changing room," New Zealand coach Mike Hesson said.
"With over 200 Test wickets, his stats speak for themselves, but his knowledge and experience make his presence in the group so important.
"He's been a great role model for younger team mates and will be sorely missed. We wish him all the best for the future."
Martin's comical batting statistics also made him a crowd favourite whenever he walked out with his pads on.
He has the most number of ducks (36) behind West Indies' Courtney Walsh (43) and tops the list of most pairs (dismissed without scoring in both innings) in a career with seven.