The Canadian goalkeeper battled against testicular cancer last year and, although he beat the illness, doctors have told him he can no longer play professionally.
Craig, released by the club this summer, has been awarded a testimonial by the club even though he has only been at Upton Park for five years.
"I would like to thank them all for their support - Glenn, the medical staff, the board, and everyone else connected with the club, not least the fans who have sent me letters," he says.
"I would like to go on record to thank the club for the sensitive way they have handled things, although I am very upset with the realisation that my career has come to an end.
"On the other hand, I have to say that if I had been younger when I contracted the illness I would not have had 18 fantastic years, so in that sense I am lucky.
"If the football has to go, it has to go, and the main thing is that I have got through it.
"The club are offering me a testimonial which is good of them as I have not been here 10 years."
It has been a tough time for Craig, who lost good friend and former Hammers goalkeeping coach Les Sealey last year after he died following a heart attack.
"I miss Les," says Craig. "When Ludo came to the club, though, he became a good friend to me, that made things easier, and I enjoyed working with him.
"You could say having to retire now is bad timing, as I think I had five good years left in me, but when is a good time to get cancer?
"It has been difficult for my family - and changed my perspective on life."
"My medical advisers told me I would be unable to maintain the necessary level of fitness to compete at the game's highest level," he admits, "and although I have overcome the cancer, it has taken a lot out of me.
"But I just can't get away from the fact that I wouldn't be fit enough to play at the top, and as for dropping down the divisions, I didn't even consider it after so many good years at the top - but I doubt I would have been able to do it."
Craig's message to other cancer sufferers, though, is one of hope, and he insists: "If I was leading a normal life, working in an office rather than doing a physically demanding job, it would have been okay.
"It is best to stay upbeat if you have cancer - which is not to say that if you don't you will suffer more, because big advances are being made scientifically."
Craig, who joined Hammers from Ipswich Town in the summer of 1997 for £500,000, worked for Canadian television during the recent World Cup and hopes to continue working in the media.
MD Paul Aldridge adds: "Craig was a popular figure with the players, management and staff at the club and will be greatly missed. We wish him continued good health and every success for the future."
Mick McGuire, deputy chief executive of the PFA, says: "We are always sad when one of our members is forced to retire from the game prematurely, and we are just happy to have been able to offer our support when it was needed."