A re-run of the presidential vote was announced after Kenya's Supreme Court nullified the result of the August 8 election due to Odinga's complaint.
If Raila had already written to the IEBC to announce his withdrawal from the race, the law requires that the electoral body declares Uhuru, the only remaining candidate, as duly elected President.
Odinga's team claims its withdrawal requires the IEBC to cancel the election and conduct fresh nominations, which should take place at least 90 days before a general election. He said if all the NASA demands were not met, there would be no reason to run in an election that "would be rigged".
Reports say the situation in Kenya is a worry for the US government which is "deeply concerned" about the prevailing political environment in Kenya as police and protesters continue to clash ahead of its presidential election on October 26.
The Supreme Court stunned the nation last month when it annulled the August 8 election victory by President Uhuru Kenyatta, citing what it called widespread irregularities in the counting process.
The statement was read in shifts among the NASA principals, who said current the environment is not stable for a country to hold a free, fair and credible election.
"The only election Jubilee administration is interested in is one that it must win, even unlawfully", he said.
Three people were seriously wounded during opposition demonstrations for changes to Kenya's electoral commission before fresh presidential elections later this month, a witness said Monday.
But Mr Kenyatta says he is ready to proceed with the new vote as planned.
His party, the National Super Alliance (NASA), had vowed not to take part in the poll re-run unless the election commission was reformed.
Kenyatta termed the decision a "judicial coup".
NASA or any other party opposing the IEBC decision to declare Uhuru victor can go to the Supreme Court and still insist on a fresh election after which the court will give its verdict.
Kenyatta has said he does not want changes to the electoral commission. A majority found so many irregularities, they said the elections did not meet the threshold set out by the constitution.
According to figures released by IEBC chairman Wafula Chebukati, the incumbent garnered 8,203,290 votes while Odinga managed 6,762,224 votes.