Wright, who competed under her maiden name of Schlanger before marrying fellow Australian Olympic swimmer Chris Wright in 2014, won gold as a member of the 4x200 freestyle team in Beijing and the 4x100 freestyle squad in London four years ago.
The 29-year-old had been battling a rib injury before the Australian championships in Adelaide and only had about three weeks of training to prepare for her final tilt at the Olympics.
She was 13th fastest in the 100 freestyle semi-finals on Monday and failed to advance to the final, which is later on Tuesday. The top six qualify for the Olympic squad, with the top two taking the individual places in the event.
"With that I wave goodbye to a competitive swimming career that spanned more than 15 years," Wright wrote on her Facebook page on Tuesday.
"Despite injury, I hang up my goggles without disappointment or regret ... (and) I now look forward to my future out of the pool, which includes beginning Medical School at Bond University in a few short weeks."
Apart from anchoring the relay squad to the only gold medal won by Australia in the pool in 2012, Wright also won silver in the 4x200 freestyle relay and 4x100 medley relay in London and bronze in the 4x100 freestyle relay in Beijing.
She also won world championship gold medals in 2007 and 2015 as a member of the 4x100 freestyle relay team.
(Reporting by Greg Stutchbury in Wellington; Editing by Amlan Chakraborty)
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