Mr Prokhorov is one of Russia's richest menRussian billionaire Mikhail Prokhorov has said he will challenge Prime Minister Vladimir Putin in next March's presidential election.
Mr Prokhorov said it was "the most serious decision" of his life.
Saturday saw Russia's biggest demonstration in years by protesters calling for fresh parliamentary polls over alleged voting fraud.
Mr Putin's party, United Russia, barely scraped a majority in the elections held earlier this month.
"I have made the most serious decision of my life. I am running for president," Mr Prokhorov said at a news conference.
Mr Prokhorov said he would not build his presidential campaign on criticism of Mr Putin.
"Criticism must make up no more than 10%… I would like to focus on the things I would do," he said.
Power struggleEarlier this year, the metals billionaire and owner of the US NBA New Jersey Nets basketball team made a short-lived effort to challenge the United Russia party in this month's parliamentary elections.
He later resigned from his own party, the Right Cause party, following an internal power struggle that he blamed on the Kremlin.
He then accused Kremlin strategist Vladislav Surkov of being linked to the party's split and said he would push for Mr Surkov's dismissal.
On Monday, he said: "I have found a more sophisticated way [to dismiss Surkov], I think I should just become his boss," Mr Prokhorov said.
In a recent blog, Mr Prokhorov said he saw no alternative to Mr Putin as president.
"Whether they [Russian people] like it or not, Putin is so far the only figure who can manage this inefficient state machine," Mr Prokhorov said.
Mr Prokhorov is ranked by Forbes as Russia's third richest man with a fortune of around $18bn (£11bn; $13bn euros).
'Proof in the pudding'The parliamentary elections on 4 December were criticised by observers from the Organisation for Security and Co-operation in Europe (OSCE), who said there had been "severe problems with the counting process".
They said the poll was slanted in favour of Mr Putin's party, United Russia, and that there had been irregularities including the stuffing of ballot boxes.
The United States expressed "serious concerns" about the conduct of the vote.
Pro-Putin demonstrators hold a rally in Moscow two days after the biggest protests yet against himTens of thousands of people have taken to the streets of Russian cities calling for a re-run.
President Dmitry Medvedev said on Sunday on his Facebook page that the alleged irregularities would be investigated, although a spokesman for Mr Putin, Dmitry Peskov, said the overall result would not be affected.
The US Secretary of State, Hillary Clinton, said on Monday that she was encouraged by the Russian protests.
"There were dozens of them across the country and the fact that the government has announced it is willing to investigate allegations of fraud associated with the 4 December Duma elections is a good sign and a reassuring position for the Russian people."
But, she added, "the proof is in the pudding".
On Monday the Russian authorities organised their own rally in Moscow in support of Mr Putin and his ruling party.
However, the BBC's Steve Rosenberg in Moscow was told by some protesters that they had been paid to attend and others said they were students who had been told to go by their teachers.
Our correspondent says despite the anger against Mr Putin it is unclear how much support Mikhail Prokhorov will be able to generate when he runs for the Kremlin.
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