The 35-year-old Glaswegian also competed in Beijing in 2008 but was not selected for this year's London Games.
"I'd said for a few years that I would most likely retire at the end of 2012," said Walsh.
"I've been living in a little canoe slalom bubble for most of my life, being lucky enough to pursue my childhood passion."
Along with winning the silver medal in 2004, Walsh won bronze medals in the 2006 and 2007 World Championships, was World Cup champion in 2004 and European champion in 2008.
"My greatest achievement is having consistently medalled at major championships for a number of years, particularly in the period from 2004 to 2009," he added.
"In a lot of major championships I hit the podium which is quite rare. Certainly in that period there weren't many people, if anyone else, that was hitting the international podium as regularly as I was."
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