His decision to accept her withdrawal served as an acknowledgment that even a president fresh from reelection has only a limited amount of political latitude in a still-sharply partisan Washington.
Obama has only a few weeks to negotiate a year-end deal with congressional Republicans to avert the "fiscal cliff." And with two years left to make his mark before lame-duck status begins to set in, he plans to move quickly on immigration reform and perhaps climate-change legislation that could help define his legacy.
A prolonged fight over Rice's nomination would have interrupted those plans - perhaps for only a few weeks, but perhaps for far longer given the bad blood such fights have stirred up in the past.
As partisan criticism mounted in recent weeks, White House officials were informed by Senate Democrats that, while Rice's nomination would probably succeed in the end, it would come at a steep political cost to the rest of his agenda.
"I think it was more in this particular instance a decision about whether to have another significant distraction and partisan fight amid a lot of other priorities," said a senior administration official, who spoke on the condition of anonymity in order to discuss personnel issues. "Now it's one less log on the fire."
Rice alluded to the likely fight and the threat it posed to Obama's broader agenda in her letter to the president Thursday, in which she also said that "the position of Secretary of State should never be politicized."
But for Obama, a famously cool politician who rarely lets emotion intervene in decisions, the Rice episode provoked anger and, in the end, a sense of resignation over how little Washington has been altered by the recent election.
In his post-victory news conference last month, Obama challenged Senate Republicans critical of Rice to come after him instead, saying that "when they go after the U.N. ambassador, apparently because they think she's an easy target, then they've got a problem with me."
"And should I choose, if I think that she would be the best person to serve America in the capacity of the State Department, then I will nominate her," Obama said. "That's not a determination that I've made yet."
Rice had emerged as the face of the administration's inconsistent response to the Sept. 11 attack on the U.S. mission in Benghazi, Libya, in which Ambassador J. Christopher Stevens and three other Americans were killed.
In mid-October, Rice said on Sunday news programs that the attack appeared to have arisen spontaneously from public demonstrations sweeping the Middle East over a video disparaging the prophet Muhammad. Those remarks, which came from White House-approved "talking points," have since been challenged by evidence indicating that the attack was planned and carried out by members of al-Qaida in North Africa.
Republican Sens. Lindsey Graham of South Carolina, John McCain of Arizona and Kelly Ayotte of New Hampshire asserted that Rice is unqualified to head the State Department because of what they alleged was a misleading account.
There was a sense Thursday inside the administration of anger and disappointment - as much over the way Rice had been treated as over her withdrawal from consideration.
White House officials say Obama had yet to settle on a replacement for departing Secretary of State Hillary Rodham Clinton. But he had narrowed his choices to Rice and Sen. John Kerry, the Massachusetts Democrat who heads the Senate Foreign Relations Committee and who is now considered likely to receive the nomination.
"He certainly accepted the logic that another major distraction at this point would disrupt not only our domestic agenda but also our foreign policy plans," said the senior administration official.
"But I think he's angry at the way that Susan Rice was targeted for partisan attacks related to something that she essentially had no responsibility for - namely, the intelligence assessment and security at the mission in Benghazi," the official added.
Administration officials say Kerry, who played the part of Mitt Romney in Obama's debate preparation this year, is an ally who has supported the president's foreign policy agenda. Kerry is not as personally close to Obama as Rice is, but several White House officials said he is trusted.
Many Democrats on Capitol Hill have made clear, in private, that they prefer Kerry as the next secretary of state, according to several senators and aides who requested anonymity to speak freely about the president's choice.
Some worried that the fallout from the Benghazi attack could have turned Rice's nomination into the first tough vote of the 2014 election season. Others were more concerned about having to fight for Rice as Obama also pressured Republicans to accept higherupper-end tax rates as part of a broad deficit-reduction deal.
"She could be confirmed," said a second senior administration official, "but at a high cost."