Patil, who was the coach of Kenya team that reached the semifinals of the last World Cup, cited his contract with the Oman national team to pull out of the race.
He is also invloved with promoting schools cricket in Mumbai.
"Patil has sent a letter to this effect last night to BCCI Secretary S K Nair in Thiruvananthapuram," sources told PTI.
Patil was the India team coach during the 1996 tour of England when opener Navjot Singh Sidhu returned midway through the tour following a row with captain Mohammad Azharuddin.
With Patil pulling out, the race to become the next India coach has narrowed down to former Australian players Greg Chappel, Tom Moody and former India player Mohinder Amarnath.
BCCI has appointed a six-member committee to fill the post which became vacant after New Zealand's John Wright stepped down after a four-year tenure at the end of the series against Pakistan.
The committee comprises BCCI President Ranbir Singh Mahendra, former President Jagmohan Dalmiya, Secretary S K Nair and former captains S Venkataraghavan, Sunil Gavaskar and Ravi Shastri.