Sarah Palin burst on to the national political scene in 2008 as vice-presidential candidate The 47-year-old's announcement ends months of uncertainty over her plans.
Ex-Massachusetts Governor Mitt Romney and Texas Governor Rick Perry lead the Republican pack to challenge Barack Obama for the White House in 2012.
"After much prayer and serious consideration, I have decided that I will not be seeking the 2012 GOP nomination for President of the United States," Ms Palin wrote in a letter to supporters.
"My family comes first and obviously Todd and I put great consideration into family life before making this decision."
But Mrs Palin said that in the coming weeks she would "co-ordinate strategies to assist in replacing the president, re-taking the Senate, and maintaining the House".
Mrs Palin did not endorse any of the existing presidential contenders, but ruled out running as a third-party candidate. Speaking to talk radio host Mark Levin, she said: "I would assume that a third party would just guarantee Obama's re-election and that's the last thing our republic can afford. So the consideration is not there for a third party, no."
Her announcement comes a day after New Jersey Governor Chris Christie ruled himself out of the race.
Mrs Palin burst on to the national political scene in 2008 as the vice-presidential candidate on the White House ticket of Arizona Senator John McCain.
After losing the 2008 election she returned to Alaska, and then stepped down as governor half way through her first term.
Mrs Palin had fanned speculation that she was considering a bid for the presidency when she announced a summer bus tour with stops in early-voting US states.
She has been a champion of the conservative Tea Party movement and is one of the most recognisable faces in US politics.
The mother-of-five has signed a number of lucrative television deals, published two best-selling books and set up a successful fundraising machine.
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