Houlihan, 24, decided to retire after the advice from specialist doctors in Adelaide, Melbourne and Perth.

His father Tom Houlihan said it was a devastating end to a promising football career, but his health had to come first.

"I'm extremely proud of everything that he's achieved, but it's just one of those unfortunate things," he said.

Houlihan's latest head injury came in the final round of the 2012 South Australian National Football League season, where he was knocked out following a sling tackle while playing for South Adelaide. Houlihan, who played 15 games in five seasons with the West Coast Eagles before being delisted at the end of 2011, becomes the second AFL player to be forced into retirement because of a head injury.

Former Melbourne player Daniel Bell hung up the boots in similar circumstances in 2010.

AFL Victoria Wimmera development manager Geoff Burdett said he was sad to hear Houlihan's news.

Burdett described him as a hard-running wingman with elite athletic ability.

"Tim is just one of those guys who could run all day - he's a bit of a Forrest Gump," he said.

"He still holds the three-kilometre time trial record at the AFL Draft Combine and his running ability is what caught the eye of West Coast.

"It's a real pity that this has happened but I think he's considering returning to his running."

Houlihan was a talented footballer and runner from an early age. He won his first Horsham District Football League premiership with Harrow-Balmoral at 15 years old.

He went through the Wimmera Schoolboys and North Ballarat Rebels development programs before being drafted by the Eagles as a fresh-faced 17-year-old with pick number 43 in the 2006 AFL National Draft.

The AFL will host a Concussion in Football Conference to discuss the issue next month.

AFL medical director Doctor Peter Harcourt said the conference, the first of its kind in Australia, underlined the seriousness with which the AFL and other football codes treated the issue of concussion management.