"I ask all my popular supporters across the country to use all their potential and support for the success of our respectable brother, Ebrahim Raisi", he said.
His decision comes one day after conservative Tehran mayor Mohammad Bagher Ghalibaf withdrew from the race, paving the way for a head-to-head battle between Rouhani and hardline cleric and jurist Ebrahim Raisi. Every Iranian president since 1981 has won re-election.
The campaign has been marked by stark differences over economic policy between the investment-friendly Rouhani, the architect of the 2015 nuclear deal, and conservatives who want to expand subsidies for the poor and spur domestic industry.
Raisi, a cleric and former attorney general, serves as the head of the Imam Reza charity foundation, which manages a vast conglomerate of businesses and endowments in Iran. "A man who should be on trial for the most heinous crime in contemporary Iranian history, is instead seeking the presidency", said Hadi Ghaemi, the executive director of the New York-based Center for Human Rights in Iran (CHRI).
The expert expects that if Jahangiri quits in favor of Rouhani, the elections will be held in one round and President Hassan Rouhani will win. Trump, who has called the nuclear deal a "disaster", put Iran "on notice" after it tested a missile test this year, and has pleased the U.S.'s Sunni Gulf Arab allies by vowing to confront growing Iranian influence in the region.
"Vote for Rouhani because he is the man for hard situations".
President Hassan Rouhani remains the narrow favorite for a second term thanks to Iran's re-engagement with the world after the lifting of sanctions, but has been hammered by hardline foes over his failure to rehabilitate the economy.
Reformist candidates and women were again excluded from the ballot by a clerical.
The nuclear deal between Iran and the six world powers ended a decadeslong crisis that removed sanctions on almost 80 million Iranians and potentially averted another military confrontation in the Middle East involving the United States.
According to polling released last month by the Iranian Studies Polling Agency, 28 percent of the Iranian public describe themselves as reformists, versus only 15 percent who consider themselves hard-liners or "principalists".
Mr Raisi is a close ally of Supreme Leader Ayatollah Ali Khamenei.
Qalibaf's withdrawal gave "strength and momentum to Raisi's campaign" at a time when voter interest is peaking, said Mauriello. "In Tehran, his votes will go mainly to Rouhani but outside Tehran his supporters will vote for Raisi", said political analyst Hamid Farahvashian.