Emery said on Wednesday that he was grateful for being considered for the Newcastle job but was "even more grateful" to be able to continue with the Spanish club that he guided to the Europa League title last season.
"Villarreal is my home and I am 100% committed to the club," he said in a statement posted on his Twitter account.
The former Arsenal and Paris St Germain coach told Villarreal club president Fernando Roig about his decision to stay after the team's 2-0 home win over Young Boys in the Champions League on Tuesday.
Talks about his imminent departure had spread quickly before the game. In the post-match interview he said "there was some interest" but "no offer" made by Newcastle.
"For all the noise yesterday in another country, within the club there was transparency and loyalty with the Roig family and with my squad, which is the most important thing," said the Spaniard, who turned 50 on Wednesday.
The victory over Young Boys left Villarreal tied at the top of Group F with Manchester United in the Champions League.
In the Spanish league, however, they are struggling and are winless in their last four matches, with three losses and a draw. The team lies 13th with 12 points from 11 matches.
Newcastle, fighting against relegation in the Premier League, were recently purchased by Saudi Arabia's sovereign wealth fund, with the club firing coach Steve Bruce soon after the takeover.
