Rice will continue as US ambassador to the UN. And, as per fresh speculation, she might at a later date be named national security adviser, which won't require senate confirmation.
Senator John Kerry, senate foreign relations committee head who played Mitt Romney to prepare Obama for the presidential debates, has emerged as the frontrunner for the job.
Rice's decision comes after Republicans threatened to use every means possible to block her appointment. They believe Rice misled the country on the death of four US officials in an attack on the country's mission in Benghazi, Libya, on September 11.
Actually, she had only read from a memo prepared for her by the intelligence community.