Nebot, one of the most well-known politicians in Ecuador, says he will not run for president if a new assembly rewriting the country's constitution calls presidential and legislative elections as early as this year.
However, he told Reuters he will run for mayor again in order to use his popularity to urge voters to reject Correa.
"If the government does something good I do not oppose that, but if they seek to destroy Guayaquil and if the president wants to become an emperor ... then I will fiercely oppose that," he said.
One in six Ecuadoreans live in Guayaquil, the country's richest city.
It is also Correa's birthplace and has become a key political battleground for the ally of Venezuela's president, Hugo Chavez.
Last week, Correa gathered a similar crowd of about 40,000 supporters in Guayaquil to mark his first year in office, in which he has succeeded in regaining most institutional powers from the opposition but also seen his popularity fade.
The president's popularity has dropped to 57 per cent, with polls claiming voters are opposed to his style of government and the failing economy.