Daley announced an "exploratory" committee, but campaign insiders insist he's in for the long run. If Daley stays in the race, it would be the second consecutive election cycle in which incumbent Pat Quinn faced a primary challenge:
Daley made his announcement the new-fashioned, YouTube way: No reporters questions allowed or even possible.
"Let's face it. We're in serious trouble," he said in the Internet video.
In the two-and-a-half-minute video that emphasized Illinois' problems, the former U.S. commerce secretary used photos to remind voters of his year as White House chief of staff. He also stressed what he calls the state's need for new leadership.
"We need a governor who takes the field, takes command and gets things done," Daley said.
Incumbent Democrat Pat Quinn issued a statement reading in part, "The governor is focused on working hard for the people of Illinois - there will be plenty of time for politics in the future."
Attorney General Lisa Madigan, who has previously said she was "seriously considering" running for governor, had no comment on Daley's announcement and would not answer political questions.
"When I announce that I'm running for governor, if that's my decision, we can handle all those exciting questions then," she said.
"If it's a three-way race, it'll be an all-out war," said political science Professor Paul Green.
Green says he doesn't think Daley would stay in a three-candidate race involving Madigan.
"If she decides not to run, he will run. This is just setting the table for himself so he can be better prepared in case she doesn't run," Green said.
"We need leadership that gets things done," Daley said in his video.
Bill Daley, 64, is the son of the late Chicago Mayor Richard J. Daley and the youngest brother of former Mayor Richard M, who during an exclusive interview told ABC7 his actions as mayor did not damage the Daley brand:
"This is not a family affair. This is my brother Bill's decision. He'll have to stand on his own two feet, rightfully so. And he'll campaign," Richard M. Daley said.
After a year as President Barack Obama's chief of staff, would Obama help Bill Daley become governor like he helped Rahm Emanuel become Chicago mayor?
"I don't think he wants to get involved in the meat grinder of Illinois politics. And this will be a meat grinder," Green said.
And while Emanuel called Daley "a friend," he appeared a long way from an endorsement.
"My focus right now is being the Mayor of the City of Chicago and focus on my job; that's my responsibility," Emanuel said.
Richard M. Daley told ABC7 his own legacy, including parking meters, should not affect Bill Daley's chances. And he said his brother could be as successful downstate as in the Chicago area.
"They're all the same issues. There's no upstate, downstate, sideways, this way. I found out as mayor. Every mayor has the same issues," Richard M. Daley said.
On the Republican side, primary candidate Bruce Rauner began airing television commercials Tuesday.
Daley said in the video posted overnight that he was forming the committee to explore running in the 2014 race, a noncommital move that would allow him to start raising money. However, spokesperson Pete Giangreco said later that Daley was "100 percent" in the race, despite the exploratory label that is currently attached to the campaign.
Bill Daley was traveling Tuesday and was not available to speak to reporters directly. ABC7 Chicago was told he would not talk until Thursday.
"We need solutions. We need action. We need leadership that gets things done, and the people of Illinois can't wait," Daley says in the video. "We can't wait for the legislature to get well on its own. We need a governor who takes the field, takes command and gets things done."
Daley also sharply criticized Springfield in the video for failing to pass key issues like pension reform and gay marriage.
"And for those who aspire to lead the state, now is the time to proclaim. We can't wait," Daley said in the video.
Daley's camp maintains he's committed to running for governor, but ABC7 Political Analyst Laura Washington says he has given himself some wiggle room to leave the race, if Madigan chooses to run.
"This way, if he explores, Lisa Madigan gets in, and it doesn't look good in terms of numbers, he can bow out later on," Washington said.
Daley, the former commerce secretary under Bill Clinton, is a political powerhouse who has never held an elected office.
Some Illinois voters say they are looking for a fresh start in Springfield.
"Somebody new, but it's got to be somebody new that people can trust, too," voter William Smith said.
"I'm leaning more towards the Republican side these days, with the Democrats being all over the boards. So, I won't vote for him," said voter Robert Sanchez.
"I would vote for him. I think he's a good candidate," said voter Cheryl Ingram.
In a statement, the Quinn campaign wrote Tuesday:
"Gov. Pat Quinn has a strong record of getting big things done for the people of Illinois," a Quinn statement said. "After 10 years with no capital construction program, Gov. Quinn fought for and signed into law the largest capital construction program in state history, which is putting hundreds of thousands of people back to work building roads, schools and bridges. Gov. Quinn delivered landmark education reform that is a model for the nation; strong, new ethics laws to clean up corruption, and recently, legislation to extend health insurance to thousands of people who don't have it."
Gina Natale, a campaign aide to Lisa Madigan, responded to Daley's news in a statement Tuesday:
" Attorney General Madigan has made it clear that she is seriously considering a run for governor, but her first priority is focusing on her job as attorney general.This is an interesting move given that polls have shown Mr. Daley does not fare well either in a two- or three-way race."