Hamm made the 2008 Olympic team but a broken bone in his hand and an injured shoulder forced him to withdraw a few weeks before the Games.

"I hated the way my last attempt at the Olympics finished up," he said.

"I didn’t want my career to end that way.

"I don’t feel I’m quite at the point in my life, as far as gymnastics goes, that I can’t contribute to the team and potentially compete for medals."

Hamm, who also won the 2003 world all-round title, is now debating whether to train at the Olympic Training Center in Colorado Springs or the Swiss Turners Gymnastics Academy in Wisconsin, where he could rejoin former coach Stacey Maloney.

Hamm, 27, had been working as a bonds and futures trader in Chicago but admitted that the call of London 2012 had been hard to resist.

"We all know my body won’t hold on for that much longer," he said.

"My feeling was like, ‘You either do this now or you can live and regret it later on.’

"That job will be there in the future."

Steve Penny. the President of USA Gymnastics, was delighted by Hamm's decision.

He said: "The way I look at it is, Paul Hamm is one of the best male gymnasts to ever walk on this planet.

"He’s got some unfinished business he wants to try to take care of.

"I respect that and people in the sport understand that.”

Hamm will try to come back as an all-around performer, not a specialist, with his first major target, the World Championships at Tokyo in October 2011.

He said; "There’s no real point in me not doing the all-around. I’m able to do it.

"When I look at my medal possibilities, there’s team, the all-around, and high bar is one of my other shots.

"These individual events are getting so difficult as the sport starts to specialise."