Qureia, who lives on the outskirts of east Jerusalem, also said he thinks the Jan. 25 vote should be postponed because of Israel's move.

"It is the main issue. We must not go to elections without Jerusalem," he said at a news conference.

Control of Jerusalem is one of the central disputes in the Israel-Palestinian conflict. The Palestinians claim predominantly Arab east Jerusalem as the capital of a future state. Israel, which captured east Jerusalem in the 1967 Mideast war, considers the entire city its capital.

Israel has allowed east Jerusalem Arabs to participate in past Palestinian elections. But it is threatening to ban voting in the parliamentary election if the Palestinian Authority does not prevent the militant Islamic group Hamas from running.

Hamas, which has killed hundreds of Israelis in suicide bombings and remains committed to Israel's destruction, appears poised to make a strong showing against the Palestinians' long-ruling Fatah Party in the election.

Qureia said his decision not to run was not related to infighting within Fatah between party veterans and a disgruntled "young guard" that has formed a breakaway party and entered a separate list of candidates.

Eager to bring the rebels back, Palestinian leader Mahmoud Abbas is seeking to redraw his party's list of candidates, giving top positions to younger activists. That move has upset party veterans, including Qureia, who would have their chances of election lessened.

Although Qureia now says he will not run for a parliamentary seat, he is widely expected to be appointed to a top ministerial position in the next government.

With Fatah appearing to be in disarray, party officials have increasingly urged Abbas to delay the election. Abbas has so far rejected such calls, fearing it would make the party look even weaker.

Qureia said he would continue with his duties as prime minister. Ministers running as parliamentary candidates had been required to resign their positions for the duration of the campaign.