Bayh made the surprise announcement Monday in Indianapolis, saying: "I love working for the people of Indiana. I love helping our citizens make the most of their lives. But I do not love Congress."
His news conference will cause a scramble in Indiana where the deadline to file for the primary election is Friday.
Bayh likely would have had a relatively easy run to a third term in the Senate but his decision gives Republicans a good chance to pick up the seat. His strident tone left Congress with a lot to consider as members return to Washington after the Presidents' Day holiday.
Bayh was pointed in his criticism of the partisanship on Capitol Hill, decrying the failure of recent legislation due to political squabbling.
"Even at a time of enormous challenge, the peoples' business is not being done," he said.