Prince Andrew served during the Falklands War
In Royal Naval tradition the Duke, 41, was "dined out" at a dinner aboard the aircraft carrier HMS Ark Royal off Newcastle upon Tyne.
He now takes up a new role representing British Trade International (BTI), which promotes UK trade overseas.
Speaking to an audience of 600 servicemen and women the prince said: "This is my last day serving as one of Her Majesty's officers.
"What I have enjoyed over the last 22 years has been the remarkable change in the way that we do our business.
"In the 22 years, I have thoroughly enjoyed myself with the likes of you, not that necessarily I have served with all of you.
"But we are all of one company and we all have worn the same uniform and it has been a tremendous privilege for me to wear that uniform and to serve alongside you.
Prince Andrew joined the Royal Navy in 1979 on a short service commission as a Seaman Officer specialising as a pilot.
Flying colours
He entered Britannia Royal Naval College, Dartmouth, where he took the full range of professional training.
After passing out of Dartmouth in front of the Queen, he went on to elementary flying training with the Royal Air Force at RAF Leeming, Yorkshire, where he learnt to fly the Bulldog.
Subsequently he went through basic flying training with the navy at the Royal Naval Air Station, Culdrose, Cornwall, where he learnt to fly the Gazelle helicopter.
He received his Wings from the Duke of Edinburgh in April 1981 and won the
award for the best pilot.
After converting on to Sea King helicopters and completing operational flying training, he joined his first front-line unit, 820 Naval Air Squadron, then embarked in the anti-submarine aircraft carrier HMS Invincible.
Only six months later, with the rank of Sub Lieutenant, the prince was to see active service as part of the British naval task force which sailed to the South Atlantic to regain the Falkland Islands from Argentina.
Famously, he flew as a so-called Exocet decoy to protect warships from missile attack.
Throughout the war he flew on various combat missions, helped in casualty evacuation, transport, and search and air rescue.
Failed marriage
It was in March 1986 that he announced his engagement to Sarah Ferguson and the couple were married in July.
But serving at sea, among other things, was to put a strain on the marriage, which eventually failed and ended in divorce.
In January 1997, he started work at the Ministry of Defence in London as a staff officer in the Directorate of Naval Operations.
Two years later, in April 1999, he was promoted to Commander within the
London-based Diplomacy Section of the Naval Staff, responsible for international
relations for the Royal Navy.
The prince spoke to his colleagues of his sadness at leaving the navy.
"I now move on to other things and I need you to take over the reins and to run forward over the next few years and to take this ship on to new and greater things."
But the prince said the time had come to take on new challenges.
"I am looking forward to learning about international business where we fit into the world's economy and to see how I can contribute in any which way that I possibly can."
His new role, which he take up in October, continues the work of the Duke of Kent who has stepped down.
He will also carry out official royal engagements at home and abroad.