Dalziel has cited the death of her husband Rob Davidson from cancer last year as the key reason for leaving public office.
"I want to acknowledge all the people who have backed me, including those who have said they would like me to run again.
"The reality is the one person that I need by my side to do that, my husband Rob who died last year, has gone,” she said.
Dalziel’s decision now opens the way for a likely battle for the mayoralty between a handful of sitting councillors.
Deputy Mayor Andrew Turner has made no secret of his desire for the role – should Dalziel not run again.
He is part of the The People’s Choice, a political group aligned with Labour, which has stood back from contesting the mayoralty while Dalziel, an independent, but a former long-time Labour MP and cabinet minister, was in charge.
Right leaning first time city councillor Phil Mauger toyed with having a tilt at the mayoralty in 2019, weighing up to compete potentially against senior city councillor and friend James Gough, which would have split the right leaning vote.
In the end neither stood for the mayoralty, and Mauger gained a seat on the council table when he was elected as Burwood Ward councillor.
Those vote splitting machinations are now again likely to come into play as the centre right grouping of independent councillors works out who will be best to take the mayoralty.
Dalziel swept into the mayoralty in 2013 after incumbent Bob Parker decided not to run taking 72,600 votes, nearly 50,000 more than her closest rival Paul Lonsdale.
In 2016, she won with a 62,407 majority, and took the mayoralty again in 2019 with another substantial majority – 44,811 votes, more than 16,000 more than Darryll Park (28,260).