"The realisation was I was trying to push myself to the Olympics because that's what I've always done," said the 30-year-old, who also won Olympic 4x100m medley relay silver in Beijing in 2008 and relay bronze in London.
"I have no sort of feeling towards the water right now. I look at it and I don't really want to dive in at this moment."
Sprenger told a news conference in Brisbane that the effects of a shoulder injury suffered in 2014 had taken a bigger toll on him than he had thought would be the case.
"Towards the end of 2015, my breaststroke just didn't feel how it used to, and I became more and more frustrated," he said.
"The Olympic gold is the only thing missing from my collection, but in this sport, if the mind and body are not perfectly in sync and focused beyond capacity, the performance will not come."
Sprenger has been on the Australian swim team for a decade and set a world record in the 200 metres breaststroke at the 2009 world championships in Rome, when so-called 'super suits' were in use.
The performance-enhancing high-tech suits, whose wearers set a spate of world records, were subsequently banned by the sport's governing body.
(Reporting by Alan Baldwin in London, editing by Justin Palmer)
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