While the Panthers didn't make an official announcement, the team posted a picture of Davis on its Twitter page with the word "Respect".
Earlier in the week, Davis said he would play a lesser role on the team in 2018 because of the younger players.
"For me, it was a no-brainer", Davis said.
Davis told Brooke Cersosimo of NFL Media he will step away from the game after the 2018 season. He said at the time the deal would allow him to retire as a member of the Panthers, who selected him in the first round of the 2005 draft. A bit of a late bloomer, Davis did not make a Pro Bowl in any of his first 10 seasons but made back-to-back Pro Bowls in 2015 and 2016. He was the NFL's Walter Payton Man of the Year in 2014, ranks seventh in Panthers franchise history with 13 interceptions and eighth in franchise history with 28 sacks. Sandwiched around that honour were All-Pro honours in 2013 and 2015.
He also has only missed three games in the last six seasons, following his third ACL fix.
Davis and linebacker Luke Kuechly formed one of the best linebacking tandems in the league over the last few seasons.