Li, who narrowly missed out on a medal at her home Beijing Games in 2008 when she lost the bronze decider to Russia's Vera Zvonareva, crashed out in the first round at the 2012 London Games.
"I think it's time for younger players to have a chance at the Olympics," world number four Li told reporters in Mandarin at Melbourne Park after advancing to the fourth round with a hard-fought win over Czech Lucie Safarova.
"I don't think I'll be playing at the Olympics. As far as I'm concerned, the Olympics are too far away."
Asia's first grand slam singles champion, the 2011 French Open winner has been a reluctant standard-bearer for Chinese tennis in the past and reacted furiously in 2012 when her country's tennis administration entered her to play Olympic doubles with Zhang Shuai at London without consulting her.
The pair lost in the second round.
Li clashed with her Chinese officialdom for a number of years over training, coaching and pay early in her career before being one of only a handful of top local players permitted to manage her own team and schedule.
Since breaking away from the state in 2009, Li won a grand slam title and reached two further finals at the Australian Open, including last year's runner-up finish behind double defending champion Victoria Azarenka.
Fourth seed Li will play Russia's Ekaterina Makarova in the fourth round of the Australian Open on Sunday.
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- Vera Zvonareva