Ennahda party chairman Rached Ghannouchi said he could accept the creation of a national unity government if all political parties were represented, but a cabinet of technocrats could not manage the delicate situation in the country.
His decision seemed likely to disappoint opposition parties and the powerful UGTT union federation aligned with them. The opposition parties have said they would negotiate with Ennahda only after it dissolves its Islamist-led government.
Mr Ghannouchi said: "We refuse a non-partisan government because this type of government could not manage the delicate situation of the country. The government needs a lot of time to manage the political and economic issues."
German Foreign Minister Guido Westerwelle, the first senior European official to visit Tunisia since the political crisis broke out three weeks ago, also called for dialogue.
Mr Ghannouchi admitted the Ennahda government in Tunisia, birthplace of the Arab Spring revolutions, had not succeeded in improving the economy and handling other problems.