A recurring knee injury has forced the 35-year-old to call a halt to his playing days, which included spells with Everton, West Ham and 45 games for Rangers
The Croatian international’s knee problems were prevalent even at Ibrox 10 years ago but he still found the net 30 times under Walter Smith then Ally McCoist, including a memorable League Cup final goal against Celtic.
A statement from Lokomotiva told Jelavic to ‘rest, you deserve it’. It added: “Although Nikica is fully motivated and eager to play, unfortunately his health condition, specifically the knee situation, does not allow him to continue his career.
"He acted as correctly as possible towards the club, we are very honoured that the former nine of the Croatian national team is finishing his career at Lokomotiva Zagreb.”
Jelavic joined Rangers from Rapid Vienna for £4m in 2010.