Speaking at the University of Illinois-Chicago, the Democrat cited his work on immigration reform as his main reason for staying in Congress.
"I want to be able to have a position where I can go across the country and challenge people," he said. "I am committed to making that a movement that will bring about comprehensive immigration reform."
His announcement leaves City Clerk Miguel del Valle and Gery Chico, Mayor Richard Daley's former chief of staff, as the only confirmed Latino candidates.
"Luis has become the number one leader on this issue at the national level, and when that legislation gets signed into law, he will be known as one of the great leaders our time," del Valle said in a written statement released shortly after Gutierrez's announcement.
Unofficial mayoral candidate Rahm Emanuel called Gutierrez a "respected leader with a powerful voice in our community."
Daley announced Sept. 7 that he would not seek a seventh term.