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However, Rangers sources suggest that more than one person is still in contention for the job.
Ruhl has held positive talks with Rangers, but the club is taking its time to decide the next date, even if it means the German is out of the process.
Having coached VRB Leipzig, Southampton and Bayern Munich and been assistant coach in Germany, Rühl was appointed by Sheffield Wednesday in October 2023, becoming the youngest manager in the English Football League.
He steered the club away from relegation and finished 12th the following season, but Rühl departed this summer amid club ownership and financial problems.
News that he has withdrawn from the competition for the Ibrox job came on the day former Rangers midfielder Derek McInnes dismissed speculation linking him with the vacancy, saying he was focused on keeping Heart of Midlothian top of the Premier League.
Martin has left Rangers after just 17 games in charge and his side sit eighth in the table after just one win in six matches.
They also suffered a painful 9-1 aggregate defeat to Club Brugge in the Champions League qualifiers and lost their first two matches in the Europa League.
Rangers host Dundee United in their next league match on Saturday.
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