The Bosnian international has called time on a successful six-year stint hopinh to allow a youngster to come in and make his mark at the troubled Glasgow club
The 32-year-old is the longest serving player on the Ibrox outfit's books and has made more than 220 appearances since joining in 2006 from Austria Vienna.
He explained that his decision to end his time at Rangers comes in the hope of allowing a younger player ''to contribute to new successes at the club with passion and zest".
Papac helped the club to three SPL titles, two Scottish Cup wins and three Scottish League Cup victories during his six-year spell.
Following the announcement, the Bosnian heaped praise on team-mates and managers both past and present.
"Special thanks go to Walter Smith, without whom all those achievements would not have been possible.'' he told the club's official website.
"I would also like to say thanks to all the players and trainers I have worked with in the last six seasons, when I achieved the biggest successes of my career.
As he makes way for pastures new he thanked the Ibrox faithful for whom he had played in front of during his time at the club.
"Last but by no means least, I want to say a big thanks to the fans who have always provided the biggest support and made this club one of the greatest in the world.
"I wish them lots of luck and all the very best to the manager Coisty [Ally McCoist] and the team in years to come."