Carberry, 42, has not ridden competitively since he fractured his left femur when he fell from Rich Coast at Listowel last September.
The jockey said yesterday: “I saw my surgeon today and he advised me to stop. My leg’s not strong enough. I feel gutted.”
Carberry singled out his triumph in the Aintree showpiece in 1999 on Bobbyjo, trained by his father, Tommy, as the undoubted centrepiece of his career in the saddle that began with his first winner way back in 1990.
“The highlight definitely has to be winning the Grand National on Bobbyjo,” he said.
“There’s been lots of other great moments on horses like Dorans Pride, Harchibald, Solwhit and Florida Pearl.
“I don’t know yet what I’ll do. I’m breaking a few horses in to start with.”
Champion Irish jump jockey in 2001-2 and 2002-3, Carberry won a host of big-races on both sides of the Irish Sea and rode 14 winners at the Cheltenham Festival.
Dr Adrian McGoldrick, the Turf Club’s senior medical officer, realises it was difficult for Carberry to accept he had to call it a day.
“It is tough that he has to retire on medical advice, but he is still very much involved breaking-in horses and he’s a strong character. He’ll move on,” he said.
“He’s had an amazing career and I didn’t know he’d had that many winners at Cheltenham.”
Carberry spent much of his career riding for multiple champion trainer Noel Meade.
The master of Tu Va hailed his former stable rider as “a marvellous jockey” and “a special man”.
Meade said: “He’s been a huge part of my life and the yard’s life for a long time.
“It’s a sad day, but I suppose he’s getting out in one piece - or almost one piece!
“We’ve had a lot of great times together. He’s ridden for me since he was 16 apart from the two years he was in England and even then he was riding for me on the weekends.
“There’s been a few little bumps along the way, but I don’t think there were any major disagreements.
“He was a hell of a good Flat jockey in his younger days, but he had no interest in riding on the Flat, all he wanted to do was ride over jumps.
“He’s been a marvellous jockey and he is a special man.”
Meade pointed to Sausalito Bay’s success in the 2000 Supreme Novices’ Hurdle at Cheltenham as the highlight of their partnership, as well as his triumphs on multiple Grade One winner Harchibald.
Despite his numerous victories, the enigmatic Harchibald is perhaps best known for his narrow defeat to Hardy Eustace in the 2005 Champion Hurdle after Carberry sat motionless in the saddle until the last few strides.
“There’s been a lot of great days, but I suppose the day that sticks out was Sausalito Bay winning the Supreme Novices’ (Hurdle) in Cheltenham” said Meade.
“It was my first Cheltenham Festival winner and Paul actually had a haematoma on his back that burst halfway up the straight. He could barely move afterwards.
“We also had a lot of fabulous days together with Harchibald. I suppose there’s more lines written about the day he got beat than the days he won, but that’s racing.”
Despite Carberry’s retirement now being confirmed, Meade is not planning to appoint a direct replacement as stable jockey in the immediate future.
He said: “We’re quite happy with where we’re at.
“We have Sean Flanagan, Jonathan Moore and Ger Fox riding for us and we’ll keep going as we are.”
Carberry’s final Grade One winner came aboard Gordon Elliott’s Don Cossack in the 2015 Punchestown Gold Cup.
Eddie O’Leary of owners Gigginstown House Stud said: “The only thing you can say about Paul is he’s the ultimate horseman.
“He could do things very few jockeys can do and most jockeys could only dream of.
“I wish him all the best for the future.