What medical condition causes Rocky to retire in Rocky V?

Rocky retires in Rocky V because he has cavum septi pellucidi, a brain condition attributed in the film to repeated blows to the head. After Rocky's punishing fight with Ivan Drago in Rocky IV, doctors determine that he has suffered permanent neurological damage.

The diagnosis is explained as a hole in the membrane separating the brain's ventricles, along with trauma to nearby brain-surface neurons. The doctor warns Rocky that the effects are irreversible and that another bout could be dangerous. Rocky therefore has to abandon professional boxing, despite his desire to keep fighting and his family's financial problems.

A common mix-up is answering only “brain damage.” That description is broadly true, but cavum septi pellucidi is the specific condition named in the dialogue and associated with Rocky's retirement. The diagnosis also explains his memory problems and hallucinations later in the film, including visions connected to Apollo Creed's death and his final confrontation with Tommy Gunn.