"I will not run again… either for Bundestag legislator or chancellor," she told a news conference.
Merkel added this was true for "any political function."
The chancellor admitted it was difficult for her to agree to a fourth term at the helm of the federal government in 2017, but she had not regretted this decision after the coronavirus epidemic hit.
Germans will go to the polls in September to elect a new federal parliament, which will vote on the next chancellor to replace Merkel. The 66-year-old has held the country's top job for almost 16 years.