Rossi was at the helm between November 2009 and February 2011 before being sacked after a 7-0 loss at home to Udinese.
He was reappointed just five weeks later after a poor stint under Serse Cosmi, but then left at the end of the season, leaving Pioli to take over.
But any chance of a glorious comeback is looking desperately thin as Zamparini has been told to look elsewhere for a new coach.
"At this moment in time I do not feel like going back to Palermo. Too little time has passed, and I do not think now is right," Rossi told Radio Kiss Kiss.
"I spoke to the president and I explained my reasons."
However, Rossi is keeping his options open and admits there are other clubs vying for his signature.
"I am speaking with a foreign team, but I would prefer to stay in Italy.
"The team that intrigues me most is Roma."
Palermo have been linked with youth team coach Devis Mangia, Roberto Donadoni, and former Roma man Claudio Ranieri.
Goal.com