Achebe declined the Commander of the Federal Republic, Nigeria's second highest honor, given in recognition of the author's literary contributions, BBC reported Monday.
"The situation is getting worse and worse. ... Nigeria is a country that does not work: Schools, universities, roads, hospitals, water, the economy, security, life," he said, adding President Olusegun Obasanjo is primarily responsible.
Achebe's two-page rejection letter, published in Nigerian newspapers, focused on the chaos in his home state of Anambra in southeast Nigeria.
"A small clique of renegades, openly boasting its connections in high places, seems determined to turn my homeland into a bankrupt and lawless fiefdom," Achebe said.
Chris Ngige, Anambra's state governor, was kidnapped last year and forced to write a resignation letter at gunpoint.
Achebe's "Things Fall Apart" has sold 11 million copies worldwide.