Sue Gray will not take up her post as the prime minister's envoy to the nations and regions, Downing Street has confirmed.
She was initially appointed to the newly-created role after departing as Sir Keir Starmer's chief of staff last month, saying she "risked becoming a distraction".
The government had previously said she was taking a short break before starting her new position.
But a No 10 spokeswoman said she had "now decided not to take it up".
A friend of Ms Gray said: "Sue has taken a decision not to take the role. She’s going to focus on other things."
They added: "She's taken time to think about it properly, talking to stakeholders, but ultimately she's decided she doesn't want to do it."
A Downing Street source told the OceanNewsUK: "We think she has made the right decision."
However, the Guardian reported that her decision came after she was warned the PM was likely to rescind the job offer.
Asked whether the offer was withdrawn or if she walked away, a No 10 spokeswoman said Ms Gray's appointment had previously been agreed but "she has since decided not to take up the role".
She said there were "no immediate plans" to appoint a new envoy to the nations and regions, but the role would be kept "under review".
The spokeswoman added that Ms Gray had been "uniquely placed" to hold the position, but working with the nations and regions remained a "huge priority" for the government.
Downing Street had previously said the job would be "vital".
However, it had not published details of Ms Gray's new responsibilities, and last month she did not attend the first-ever meeting of a new Council of Nations and Regions.
Ms Gray left as the PM's chief of staff after just three months in the role, following weeks of negative headlines and briefings against her, including a row over her salary.
She was replaced by Morgan McSweeney, with whom she had reportedly clashed in his previous role as Sir Keir's chief political adviser.
Ms Gray, who became a household name after leading the government's internal inquiry into the Partygate scandal, left the civil service to become a senior adviser to Sir Keir last year.
