You may decide not to accept a job offered you after starting a job search. Maybe you chose to accept a position somewhere else; perhaps the salary wasn't what you'd hoped or the location too far from your home. Maybe you had a change of heart. Whatever the reason, maintain the positive relationships you've built with the company and its people by declining first by phone, then by polite letter. If your contact, the one who offered you the job, is not available by phone, consider sending an e-mail before mailing your letter. The goal is to keep the communication formal but personable, and to avoid e-mail if possible.
Call the person who offered you the job and decline the position verbally. Tell the person to expect a letter in the mail formally declining the position as well. If unsure of the mailing address, verify it now. If a phone call is impossible, send an e-mail instead.
Thank the reader in the first paragraph of the letter for giving you the opportunity to work for the company and for taking the time to review your information and interview you.
Remind the reader in the second paragraph of your previous phone call (or e-mail), and clearly state that you are not accepting the job. If desired, offer general reasons why, including acceptance of another position or a change of heart. Stating simply, "After careful consideration, I have decided not to accept your job offer" is fine.
Conclude in the third and final paragraph by expressing additional gratitude for their consideration.
Proofread your letter carefully before mailing it (don't forget a stamp), and keep a copy for your records.
Remember that you may wish to work with this employer in future; keep the letter polite so that you can contact the employer again without worry.
Do not say anything negative about the company or your application and interview experience.