"We believe the regime men will make sure their candidate [incumbent President AbdelAziz] Bouteflika wins," the yet-to-be licensed Free Awakening Party said in a statement.
"We are boycotting the polls because they do not correspond with our standards for free and fair elections," it added.
The statement comes one day after Algerian Premier Abdelmalek Sellal announced that Bouteflika will seek a fourth presidential term in the polls, slated for April 17.
In December, Free Awakening party leader Abdelfetah Hamadache Zeraoui announced plans to contest the presidential election.
The 44-year-old Salafist, however, said he would not contest if Bouteflika decided to run on the grounds that the polls would be rigged in favor of the incumbent president.
Bouteflika, 76, has ruled the North African country since 1999.
He had suffered a stroke last April and spent nearly three months in France receiving medical treatment before returning home in July amid speculations that he would not seek reelection.