WASHINGTON/UNITED NATIONS - Nikki Haley, a rising Republican star, said on Tuesday she was stepping down as US ambassador to the United Nations, but knocked down speculation that she might challenge President Donald Trump at the next election.

Sitting beside Trump in the Oval Office, Haley said her 18-month stint at the United Nations had been "an honor of a lifetime" and that she would stay on until the end of the year.

A former governor of South Carolina and the daughter of Indian immigrants, Haley, 46, is the highest profile woman in Trump's Cabinet and has often been seen as a possible presidential candidate.

Haley criticized Trump during the 2016 election campaign but has been the face of his "America First" policies at the United Nations, steering the US withdrawal from several UN programs and ardently defending his hard-line policies against Iran and DPRK (Democratic People's Republic of Korea) over their nuclear programs.

Haley said in her resignation letter to Trump that she would "surely not be a candidate for any office in 2020" and would instead support his re-election bid. She referred to returning to the private sector and some media reports said she had debts to pay off.

But Haley also said she did not have any future plans set, and her decision surprised many at the White House and the United Nations.

Speaking to reporters later on Tuesday aboard Air Force One, Trump said he had five people on his short list for UN envoy, including former White House adviser Dina Powell, a friend of Haley's. Trump said US ambassador to Germany, Richard Grenell, was not on the short list but that he was willing to consider him.

Trump's eldest daughter Ivanka Trump, who is a senior adviser to her father, ruled herself out of consideration in a Twitter post. He had said she would be "incredible" in the role and acknowledged he would be accused of nepotism if he nominated her.