WASHINGTON (Reuters) - Indiana Governor Mitch Daniels said on Sunday in an email to supporters he had decided not to seek the Republican presidential nomination because of family considerations.

"The counsel and encouragement I received from important citizens like you caused me to think very deeply about becoming a national candidate," Daniels said in the email sent by Eric Holcomb, chairman of the Indiana Republican Party and a close adviser to the governor.

"In the end, I was able to resolve every competing consideration but one, but that, the interests and wishes of my family, is the most important consideration of all," he said.

"If I have disappointed you, I will always be sorry."

Daniels, a budget director in the administration of Republican President George W. Bush, had built a reputation as dedicated to reducing U.S. debt and deficits, calling them the "red menace" that threatens to engulf the country.

His decision not to run removes a Republican heavyweight from a field that many political analysts view as weak.

His decision not to run well may enhance Mitt Romney's chances of becoming the Republican front-runner. Romney, a former Massachusetts governor, has been leading some early polls.

(Writing by Eric Walsh)