His training partner Katerina Thanou, silver medallist in the 100 metre sprint at Sydney, on Wednesday said she too would not compete.
The pair announced their decisions after an International Olympic Committee (IOC) hearing into why the two, Greek national heroes, missed drug tests last week.
Their controversial coach has also handed in his accreditation.
"With a sense of responsibility and national interest I am retiring from the Olympic Games," Kenteris told reporters as he emerged from the Athens hotel where IOC officials are based.
Thanou, the other Greek athlete in the row, emerged a few minutes later, saying: "I will not take part in the Games. I will not race. I have handed in my accreditation to the IOC."
The IOC declined to comment.
Kenteris said: "I am adamant, I was never notified to go to the Olympic Village to take the test. Over the last years, I have gone through over 30 tests with no problems," he added, referring to the missed eve-of-Games test last Thursday.
"With a full sense of responsibility, I am withdrawing from the Games."
"With a full sense of responsibility, I am withdrawing from the Games"
He also said he would break ties with his coach: "I announce that I am ending my association with the coach Christos Tzekos."
Kenteris, a candidate for the honour of lighting the Olympic flame at last Friday's opening ceremony, was a surprise gold medallist in the 200 metres at the Sydney Games.
Thanou took silver in the women's 100 metres.
"I came here to testify before the committee," she said. "Some Greeks have accused me in the last few days of having used forbidden substances, whereas there is no such issue for the relevant IOC committee."
Olympic anti-doping testers failed to find the two at the Olympic village on Thursday.
Later that night, they said they were in a motorcycle accident and checked into hospital, leaving only on Tuesday.
No other vehicles were involved in the accident and no witnesses have come forward.
An IOC disciplinary hearing was postponed twice because the two said their injuries had prevented their attendance.