Steffensen, the reigning 400m Games champion, stated he will not compete despite being injury-free and clocking strong training times.
"This is the toughest decision I've ever had to make but I want people to realise this is more than another headline, more than someone creating controversy. I want people to understand 'hey, John really is passionate about this'," Steffensen said.
The 28-year-old outspoken Sydneysider said he wants to expose the 'bullying, egotism and outdated approach' of the national governing body, while also revealing four years of unanswered complaints where his room at the 2006 Melbourne Commonwealth Games was found broken into and trashed.
"And I know some people will be saying 'OK, here goes John again. But this decision, it's going to cost me money, my reputation will take a hit and my chance of ever winning consecutive Commonwealth golds is gone.
"See, I love Australia. Love running for my country. But by sacrificing two years of my own preparations for these Games, I hope people understand how passionate I am about creating change for athletics in this country," the 400m runner was quoted as saying by the Daily Telgraph.
Steffensen in the interview revealed how after completing his victory lap at the Melbourne Games, he returned to the athletes village and found his door kicked in and room trashed.
AA officials assured him the matter would be dealt with but four years on, it hasn't.
"Would any other athlete not expect answers? I've never spoken publicly about this for the sake of the sport ... but enough is enough," he said.
In January, Steffensen had major back surgery and -- on the advice of leading surgeons -- sought an exemption from the national championships 13 weeks later. The event doubled as Games trials and Steffensen hoped his medical circumstances and record would be considered but his request was denied.
"Athletes are getting bullied, dictated to, copping decisions that are essentially jeopardising careers. I explained the surgeons' findings and they effectively said 'too bad, run'. As AA is funded by the taxpayer, Australians deserve to know it needs a complete overhaul," Steffensen said.
"All up I've endured four years of discrimination but, for the sake of my sport, I've kept running, kept winning medals. Well, I can't do it anymore. I'm standing down so our next generation of athletes never endure this," he added.
