Nader's candidacy four years ago has been blamed by many Democrats for costing Al Gore the election against George W. Bush.
Nader, who will turn 70 this week, said he contemplated retirement but decided against that.
"I've decided to run as an independent candidate for president," he announced on NBC television's "Meet The Press."
"This country has more problems and injustices than it deserves," Nader said, bemoaning a "democracy gap." He said he needed to get into the race to "challenge this two-party duopoly."
"There's too much power and wealth in too few hands," he said . "They have taken over Washington."
"Washington is now corporate occupied territory," Nader said. "There is now a for-sale sign on most agencies and departments. ... Money is flowing in like never before. It means that corporations are saying no to the necessities of the American people. ... Basically, it's a question of both parties flunking."
Asked if he would withdraw if he concluded his candidacy would merely ensure President George W. Bush's re-election, Nader told interviewer Tim Russert, "When and if that eventuality occurs, you can invite me back on the program and I'll give you the answer."
Nader decided against running under the banner of the Green Party as he did in 2000.
Last week, Democratic National Committee chairman Terry McAuliffe revealed that he had met with Nader several times urging him not to run.
Asked if he was getting into the race to be a spoiler, Nader replied: "A spoiler is a contemptuous term, as if anyody who dares to challenge the two party system ... is a spoiler, and we've got to fight that."
Third party candidacies have been a greater part of presidential politics in recent years; businessman Ross Perot twice ran for president, winning 19 percent of the vote in his first try in 1992 against Bill Clinton and then-President George H.W. Bush.
"It's his personal vanity because he has no movement. Nobody's backing him," New Mexico Democratic Gov. Bill Richardson said Sunday in advance of Nader's announcement.
"The Greens aren't backing him. His friends urge him not to do it. It's all about himself," Richardson told "Fox News Sunday." "Now, Ralph's made some great contributions to consumer issues over the years, but clearly it's not going to help us,"
As the Green Party's nominee in 2000, Nader appeared on the ballot in 43 states and Washington, D.C., garnering only 2.7 percent of the vote. But in Florida and New Hampshire, Bush won such narrow victories that had Gore received the bulk of Nader's votes in those states, he would have won the general election.
Nader was born in Winsted, Conn. In 1934, and received a bachelor's degrees from Princeton and law degree at Harvard.
He began his career as a lawyer in Hartford, Conn., and first came into the public eye as the author of Unsafe at Any Speed, a book that lambasted the auto industry for producing unsafe cars.
In his career as consumer advocate he founded many organizations including the Center for Study of Responsive Law, the Public Interest Research Group (PIRG), the Center for Auto Safety, Public Citizen, Clean Water Action Project, the Disability Rights Center, the Pension Rights Center, the Project for Corporate Responsibility and The Multinational Monitor (a monthly magazine).