Mr Austin was reportedly on the short list for the Cabinet position along with Jeh Johnson, the former United States secretary of homeland security; Senator Tammy Duckworth; and Michele Flournoy, who served as the under secretary of defence for policy for President Barack Obama.
This week Mr Biden made several announcements for who he was nominating for his Cabinet, including secretary of state, treasury secretary, and director of homeland security.
But Mr Biden’s Pentagon chief nominee was notably absent from the line up.
If Mr Austin was picked, he would serve as the first Black secretary of defence in American history.
While reports have indicated that Ms Flournoy was the likely pick for the Cabinet position, sources told Axios that other factors were leading to Mr Biden potentially choosing Mr Austin instead. Those factors included race, experience, and Mr Biden’s “comfort level” with the person.
Mr Austin, 67, was the 12th commander of United States Central Command, becoming the first black commander to head the organisation. He retired from the position in 2015.
Prior to heading the United States Central Command, Mr Austin also served as the vice chief of staff for the US Army as well as the commanding general of the US Armed Forces in Iraq.
Questions were raised after Mr Biden omitted announcing his defence secretary earlier this week during other Cabinet position announcements. Concerns were raised that Mr Biden’s initial pick was changed, causing the delay in his announcement.
But sources told Axios that the decision to hold off on the announcement was actually made for a different reason.
The Biden team wanted to emphasise diplomacy in the recent announcement and de-emphasis military, according to the publication.
“So having [Department of Defence] rollout front-and-center sends one message," a source close to Mr Biden told the publication. "Not doing so sends another message. There has always been the intent to signal from Day One that this is not an administration that is going to put the Pentagon at the centre of things."