International Cricket Council announced the news of Jayawardene's decision on Twitter.
"SL legend @MahelaJay to join @KumarSanga2 in T20I retirement after the #wt20 2014," a tweet from the ICC said.
The decision came a day after another Sri Lankan veteran Kumar Sangakkara announced quitting the shortest format in the international circuit after the Twenty20 World Cup.
The 36-year-old Jayawardene has appeared in all four T20 World Cups till now and 2014 event in Bangladesh will be his last one. He was the captain of the Sri Lankan team which lost in the final of the last T20 World Cup at home against the West Indies.
Jayawardene made his T20I debut in June 2006 against England at Southampton. He led the Delhi Daredevils side in the IPL last season but found no buyers in the players' auction this year.