Senate Minority Leader Thomas A. Daschle (D-S.D.) unexpectedly announced yesterday that he will not seek the presidency in 2004, saying he preferred to make his fight against President Bush and the Republicans from his post in the Senate than from the presidential campaign trail.

"After careful reflection, I've concluded that at this moment in our history, with so many important decisions to be made about our nation's future, my passion lies here in the Senate serving the people of South Dakota and fighting for working families all across America," he said.

Daschle's decision caught other Democrats by surprise, given the signals he and his closest advisers had sent in the past week. Daschle spent last weekend in South Dakota, where he was encouraged by friends and supporters to seek the nomination. Daschle then said publicly he was leaning toward forming an exploratory committee.

His advisers were preparing for an announcement this weekend in his home town of Aberdeen, S.D., followed by possible trips to Iowa, New Hampshire and South Carolina. They had drawn up a fundraising plan and were recruiting campaign staff members. On Monday night, however, Daschle reversed course, deciding after discussions with his wife, Linda, that he would rather remain in the Senate. He did not inform most colleagues and advisers until yesterday morning.

Daschle's decision was the second surprise in a month for Democrats, following the announcement by Al Gore, the party's presidential candidate in 2000, that he would not run in 2004. As the leader of his party in the Senate, Daschle was seen by many Democrats, including potential rivals, as a potentially formidable opponent.

"He's a serious guy with a lifetime's record of exceeding eOxpectations," said an adviser to one of the other candidates, "and everybody in the field would have had to take him very, very seriously."

Everyone in the Democratic field will benefit in some way from Daschle's decision, particularly in campaign contributions that otherwise might not have been available. But the most relieved may have been former House minority leader Richard A. Gephardt (D-Mo.). He will not have to run against a close friend and will have an even greater advantage in Iowa, whose precinct caucuses will start the nomination battle a year from now.

In addition to Gephardt, Sens. John F. Kerry (Mass.) and John Edwards (N.C.) and outgoing Vermont Gov. Howard Dean already have set up presidential campaign committees. Sen. Joseph I. Lieberman (Conn.), the party's 2000 vice presidential nominee, is expected to enter the race soon and Al Sharpton of New York has said he plans to establish a committee this month.

Other Democrats are thinking about running, although it was not clear yesterday that Daschle's decision alone would compel them to do so.

Sen. Bob Graham (Fla.) met yesterday with Democratic National Committee Chairman Terence McAuliffe to discuss the race, and Graham spokesman Paul Anderson said the senator "has moved to the next level" in his consideration. Graham will decide in the next several weeks. Sens. Joseph R. Biden Jr. (Del.) and Christopher J. Dodd (Conn.) also are considering running, as is former senator Gary Hart (Colo.).

McAuliffe lunched yesterday with retired Army Gen. Wesley Clark, who has been talked about as a possible candidate. In a phone interview, Clark refused to rule out a candidacy, but said, "I am not a candidate, I haven't declared a political party, I haven't taken any political money. I'm just a concerned citizen, and I'm talking to anybody and everybody and I'm not speculating on the future."

Daschle had received conflicting advice as he considered a campaign, with some advisers arguing that he was more valuable to the party as Democratic leader in the Senate than as one of at least a half-dozen presidential candidates.

Without Daschle as leader, they maintained, Democrats would have less cohesion as the opposition party in Congress and would have more difficulty recruiting candidates and raising the money for Senate races in 2004.

Daschle also was torn about whether he could run for president and remain as Democratic leader in the Senate, and had discussed with aides whether that job could be restructured to allow him to do both. In the end, he said, he concluded he could not.

"He believed he had to be 100 percent into it [running for president], and he thought there was a major fight that needed to be waged in the Senate and that his passion lay with being leader and fighting that fight," said John D. Podesta, White House chief of staff in the Clinton administration and an adviser to Daschle.

Daschle said that with "a series of defining debates" over the economy, homeland security and other issues about to begin, the Senate could help shape the country for a generation. Calling Bush's new economic plan "wrong for the country," he said he wanted to lead the fight against it from the Senate.

Daschle said he will seek reelection to the Senate in 2004. That is a blow to former representative John Thune (R), who narrowly lost his bid for the Senate against incumbent Tim Johnson last November and who was thinking about running again.

Daschle said he had no regrets about skipping the presidential race, and friends and advisers said he sounded upbeat when he delivered the news to them. One adviser said Daschle sounded "settled" and confident that he was "entering the right fight."

Senate Minority Leader Thomas A. Daschle (D-S.D.) said that he believes he can be more effective by remaining in the Senate than by campaigning for the presidency.