The Anfield veteran has made over 730 appearances for the club, winning the the Champions League, two FA Cups and three League Cups during his career.
|9/5||Liverpool are 9/5 with PaddyPower to keep a clean sheet against Everton
"I watch Sky Sports all the time and I'm a huge fan. I can't wait to be part of their coverage and work with the best in the business," said Carragher, who will make his bow in August.
"What Sky has done for football for over 20 years is incredible and I'm thrilled to be part of their exciting plans for next season.
"I don't think there could be a better move for me, to retire from one of the world's best football clubs at the end of the season and then join one of the world's best broadcasters.
"Until that time comes, I'll remain fully focused on my remaining playing career with Liverpool and I'm looking forward to ending the season with good results."
Carragher has started 12 out of Liverpool's last 13 games, helping them to four clean sheets in seven matches.