"This decision does not come easily or without regret; especially when my potential candidacy continues to be validated by ranking at the top of the Republican contenders in polls across the country," Trump said in a statement.
Trump had been moving up in the list of possible Republican presidential candidates. An ABC News/Washington Post national poll showed Trump the second choice of likely Republican voters, behind Mitt Romney.
"I maintain the strong conviction that if I were to run, I would be able to win the primary and ultimately, the general election," Trump said in his statement.
He went on to say that business is his passion, and he wasn't ready to leave the private sector.
Trump drew a lot of attention by questioning President Barack Obama's citizenship, and when Obama released his birth certificate, Trump even took credit for it.
At the 2011 White House Correspondents' Association annual dinner, Obama targeted Trump, who was at the dinner.
"No one is happier, no one is prouder to put this birth certificate matter to rest than 'The Donald.' And that's because he can finally get back to focusing on the issues that matter, like, Did we fake the moon landing? What really happened in Roswell? And where are Biggie and Tupac?" Obama joked.