The 34-year-old revealed in Mohali today that his 14-year career in the green and gold was coming to an end, saying that this is the "right time" to walk away from the international stage.
"It's been over the last week that it's really become clear that now really is the right time to retire from all international cricket," Watson told Cricket.com.au.
"I've been playing with the thought for a few months now and I know now with the way the group is continuing to evolve, which is exciting to be able to see, with my young family as well, and seeing the potential of the international schedule is very hectic.
"And I just know it's the right time to be able to right now clear my mind knowing that I've made the decision and be absolutely ready to go for these next two very important games."
Watson was Australia's 44th Test captain and won two World Cup titles in 2007 and 2015, as well as being named Player of the Tournament at the 2012 World T20.