Castle's decision sets up a possible 2010 race against Biden's son, Delaware Attorney General Beau Biden, who's weighing a bid for the Democratic nomination but has not announced his political plans.
Republican Party leaders have encouraged centrists such as Castle to run, hoping to win back voters and regain control of the Senate. In May, key Republican senators jumped behind the Senate candidacy of Gov. Charlie Crist of Florida even though another well-established GOP candidate had stronger conservative credentials.
Castle, 70, is a two-term former governor, the lone Delaware member of the U.S. House and longest serving congressman in state history. He has never lost a political race since being elected to the state House in 1966.
Now in his ninth term in the House, Castle has carved out a reputation as a leader of Republican centrists, a fiscal conservative and social moderate unafraid to go against the party line. He has bucked the GOP's positions on abortion and the budget, for example, as well as on energy policy and the environment.
He said he had been thinking about the Senate race since it became clear that Biden would become vice president, but only made up his mind recently after discussing it with his wife.
"We need the strongest and most experienced leadership we can find in this country today," Castle told a news conference near the Wilmington train station.
Beau Biden has not announced his plans. Jason Miller, a spokesman for the attorney general's office, said late Tuesday morning that Biden likely wouldn't have any comment until after Castle's announcement.
The younger Biden, 40, returned home last week with his National Guard unit after a yearlong deployment to Iraq.
Castle said he respected both Bidens and was aware that the younger Biden could be a strong opponent, particularly with the backing of his political family.
The seat is currently held by longtime Biden aide and confidante Ted Kaufman, who was appointed by then Gov.-Ruth Ann Minner. But Kaufman has said repeatedly that he will not run in 2010.
Just weeks before the 2006 election, Castle was hospitalized for several days after suffering a small stroke, but he said Tuesday that he was left unaffected by it. He won re-election in 2006 and 2008 by comfortable margins.
On the Net:
U.S. Rep. Mike Castle: http://www.castle.house.gov