"That's my idea right now and unless there's some incredible U-turn I don't believe I'm going to change my mind," Baggio, 36, told television programme Teletutto on Monday.
The former Italy striker, known as 'The Divine Ponytail' due to his hairstyle and Buddhist beliefs, has had a career blighted by injury.
He has had a number of knee operations and a back problem has limited his appearances for his Serie A side Brescia this season.
"They've plagued me and given me a rough ride over the years," he said. "These days, at my age, it gets rougher and rougher."
Asked what he hoped to do after hanging up his boots, Baggio said: "It's too soon to say. I've still got to get used to the idea of not being out there on the pitch, running."
The hugely popular Baggio started as a professional in 1982 at third division side Vicenza and made his Serie A debut with Fiorentina three years later before embarking on a career at Juventus, AC Milan, Bologna, Inter Milan and Brescia.
He won the UEFA Cup with Juventus in 1993 and was named both FIFA's World Player of the Year and UEFA's European Footballer of the Year that year before going on to win two Serie A titles, with Juve in 1995 and AC Milan in 1996.
He made his international debut against the Netherlands in 1988 and won 55 caps for Italy, scoring 27
Baggio helped Italy reach the final of the 1994 World Cup in the United States with inspired last-minute goals against Nigeria and Spain.
He played in the final against Brazil despite a hamstring injury but his missed penalty in the shoot-out lost Italy the World Cup. He was subsequently dropped by then coach Arrigo Sacchi.
From that day on his appearances in the famous blue shirt became increasingly rare.
Coach Giovanni Trapattoni's refusal to take him to last year's World Cup in Japan, despite vociferous public and media campaigns, effectively ended any remaining hope he had of playing for his country.
Providing he is fit, Baggio's last official match for Brescia will be against his old club AC Milan on May 16.