"I'm here to announce that I won't be running for the PC leadership," Ford told reporters gathered at the family business, Deco Labels, for the announcement.
Ford said he'd received a lot of support and encouragement, but decided "literally last night" not to become a candidate.
"It's been the most difficult of my entire life," he said. "It was tougher than deciding whether to run for mayor, run for council, any decision I've ever made, this by far was the toughest."
Ford said there are five "strong" candidates to replace Tim Hudak, who resigned after the Liberals won a majority in the June 12 election, the Conservatives' fourth consecutive loss at the polls.
He endorsed Christine Elliott, the deputy PC leader and widow of former finance minister Jim Flaherty, who had close ties with the Ford family.
Flaherty and Elliott were the only elected federal and provincial members to show up when his younger brother, Rob Ford, announced he would run for mayor of Toronto in 2010, said Doug Ford.
"Loyalty means everything to us," he said. "Christine is an extremely, extremely bright individual, and she can drive this province forward."
Elliott said she'd spoken to Ford weeks ago and knew he was struggling with the decision about whether or not to run for the leadership.
"I'm very pleased that in not running he's endorsed me as the candidate," she said in an interview. "We have a family friendship going back many years, and I'm honoured to have his support."
Other candidates admitted Ford would have drawn a lot more attention to the leadership contest, which until now has been very low key, and were pleased he wants his supporters — the so-called Ford nation — to join the Tories, who lost their fourth consecutive election in June.
"I thought he would draw some excitement to the race and would have added to the membership numbers for the Ontario PC party," said MPP Monte McNaughton.
"I will take him up on his offer to help rebuild our party, to bring in new members, particularly in Toronto," added MPP Lisa MacLeod.
"We've gone from 100,000 members down to 10,000 members, so anybody that wants to bring in new members and have those new members exposed to ideas from all the candidates, I think that's a wonderful opportunity," said MPP Vic Fedeli.
The other declared PC leadership hopeful is federal MP Patrick Brown, the only one of the five who does not have a seat in the Ontario legislature.
While rivals publicly praised Ford, some Conservatives admitted privately that they felt the party dodged a bullet by not having him enter the race because of his confrontational style and public fights with Toronto police Chief Bill Blair.
Ford, the older brother of Toronto's outgoing mayor, finished second to John Tory in last month's mayoral election after stepping in as a last-minute candidate to replace his brother, who was diagnosed with cancer.
"Honestly, Rob wasn't happy that I wasn't running," admitted Ford.
The PCs made a big mistake in the spring election by promising to cut 100,000 public sector jobs to help cut the size and cost of government, added Ford.
"You don't need to do that to find efficiencies," he said.
Ford said he knows he can help bolster the chances of the PC party, which didn't win a single seat in Toronto in the June election.
"I always remind the PC party that over 80 per cent of the 330,000 votes that I ended up receiving would never, and have never, voted PC before," he said. "I'll be out there campaigning aggressively, bringing the Ford Nation base, as many as we can, over to the PC party and making sure that the PC party changes their ways."
Ford, 50, left the door open to being a PC candidate in the 2018 election in the same Toronto riding that was represented by his father, Doug Ford Sr., for one term in the late 1990s, saying it would be "very meaningful" to him and the family.
"Maybe one day I'll be serving them as MPP," he said.
Progressive Conservative members will vote May 3 or May 7 on the new leader, and the results will be announced May 9 at a convention in Toronto.
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Note to readers: This is a corrected story. An earlier version said Rob Ford ran for mayor in 2011
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