The former leader, who was ousted as prime minister by Gillard in 2010, quit as foreign minister while in Washington on Wednesday in preparation for a bid to reclaim his old job.
"If we are honest to ourselves, all the indications are we are heading to the rocks at the next elections," he said.
"It is no secret that our government has a lot of work to do if it is to regain the confidence of the Australian people.
"Rightly or wrongly, Julia has lost the trust of the Australian people, and starting on Monday I will start restoring that trust.
"That is why I have decided to contest the leadership of the Australian Labor Party."
Labor is badly lagging the conservative opposition ahead of elections due next year, with polls suggesting Gillard`s administration would be dumped by the electorate if an election were held tomorrow.
Since he resigned as the country`s top diplomat amid intense leadership speculation, Rudd, who remains popular with voters, has been savaged by senior cabinet ministers who accuse him of undermining the party for personal gain.
On current numbers, Rudd is likely to lose and be banished to the backbench, according to media who have done a head count of the 103-member Labor caucus.(*)
Editor: Heru Purwanto
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