The SDLP has said Helen Quigley, the party's leader on Derry City Council, is to leave public life.
It is understood her decision follows a party disagreement over who should replace Mark Durkan at the Assembly.
However, an SDLP spokesperson denied her decision was connected to that debate.
Mr Durkan plans to leave Stormont to concentrate on his Westminster duties and Ms Quigley was widely tipped as his successor.
Ms Quigley confirmed that she would not contest next May's Assembly elections, nor seek re-election to Derry City Council.
"Over the past week," she said, "I have had frank and confidential discussions with the party leader and the party central and I intend to maintain the confidentiality of those discussions."
She thanked the public for the messages she had received since her decision became public, and said she did not intend to make any further comment on the matter.
The Foyle MP Mark Durkan said he deeply regretted her decision and was still hoping she would reconsider.
A party spokesperson said Ms Quigley had resigned as its leader on Derry City Council but would remain a party member.
Mr Durkan paid tribute to her work and said she was equipped to be "a very effective MLA both for Derry and the SDLP".
"The local party members, accordingly, voted strongly to select her as one of the candidates for next year's Assembly election.
"They may also have voted for her later this week to, again, be co-opted to replace me, this time in the Assembly.
"It is a matter of deep regret that Helen has now chosen neither to go forward for co-option in the current contest or as a candidate next year.
"Her decision represents a significant loss to civic and party life," he said.