The 32-year-old. claimed the world crown at 122lbs in 2009 before making two successful defenses.
He pulled out of another world title challenge with current belt holder Guillermo Rigondeaux with just hours remaining until fight time last month.
Rumors then spread prior to the canceled December 15th date that Kratingdaenggym had tested positive for HIV.
Specialists have now named the disease as thalassemia, an affliction that affects red blood cells and causes anemia.
“According to the doctor, it will take time to cure it,” Poonsawat’s manager Niwat Laosuwanwat told The Bangkok Post.
“At 32, it would be tough for him to remain competitive in boxing. So it is better for him to retire now.”