The 38-year-old former England international initially quit in 2011 but was persuaded to return for United in January 2012.
"I am finally hanging up my boots for good," Scholes said on Saturday.
A first appearance since January is expected on Sunday in a Premier League match against Swansea, which will also be manager Alex Fergsuon's final match at Old Trafford before retiring.
Scholes will be collecting a Premier League winners' medal for the 11th time after Sunday's game.
"Playing football is all I have ever wanted to do," he said. "And to have had such a long and successful career at Manchester United, under the greatest manager of all time, has been an honour."
Scholes has spent his entire career at United, making 716 appearances and scoring the last of his 155 goals in September against Wigan.
Starting out as a deep-lying forward, Scholes eventually dropped back into central midfield where his touch, technique and vision could be more effectively utilized. He never lost his eye for goal, though, and turned his late runs into the penalty box into an art form.
Scholes had a particularly fierce shot and was always dangerous from outside the box.
"Paul is a truly unbelievable player," Ferguson said. "He has always been fully committed to this club and it has been a real privilege to work with him for so many years.
"Paul will play at Old Trafford on Sunday against Swansea and will collect an unbelievable but well-deserved 11th Premier League medal."
United defender Rio Ferdinand said on Twitter that Scholes was "1 of the best I played alongside also the most naturally gifted player too."
The only part of Scholes' armoury that let him down was his tackling, which was often late and clumsy. He missed the dramatic win over Bayern Munich in the 1999 Champions League final through suspension but started in 2008 when United beat Chelsea on penalties in Moscow to claim its third European Cup.
Scholes was 29 when he retired from England duty.Suggest a correction