The lashing comes as the Chancellor promised to deliver a "stable government" after breaking four months of political deadlock to agree a coalition between her Christian Democratic Union (CDU) and the Social Democrats (SPD).
Her next step up the party ladder came in September previous year when she was appointed SPD parliamentary leader, just weeks after the party's election result sunk to a mere 20.5% - its lowest level since modern Germany was founded.
And in Berlin they demanded that Germany return to the European Union leadership position.
Wednesday's report, which cited unnamed participants, said that Chancellor Angela Merkel's Christian Democratic Union, its Bavaria-only sister party, the Christian Social Union, and the center-left Social Democrats, achieved a breakthrough on the division of ministries.More news: One officer dead, two others shot while serving warrant near Atlanta
"I hereby renounce joining the federal government and at the same time implore that this should be an end to debates about personalities" within the SPD, Schulz said in a statement.
Under the terms of the deal struck between Merkel and Schulz earlier this week, the SPD will keep the foreign ministry it held in the last government and also take over the finance ministry from the CDU.
Angela Merkel has agreed a deal to form a new coalition government in Germany, four months after suffering damaging losses in elections.
He added that his personal ambitions "must be placed behind the interests of the party". The coalition deal unites the two largest factions in Germany's parliament into one governing majority.More news: United Nations investigating reports of chlorine attacks on civilians in Syria
He announced on Wednesday he was swapping the SPD leadership for the foreign ministry, elbowing aside incumbent Sigmar Gabriel after less than a year.
The SPD's youth wing Jusos - an abbreviation for Jungsozialisten, or young socialists- is the youth wing of the left-leaning SPD, Germany's oldest and second-most-powerful political party. Merkel has been fighting to remain in power since September's disastrous elections and the price she pays could be heavy, with her new government set to be much more active in pursuing greater European integration and reform and Schulz, the former European parliament president who has called for a United States of Europe, ensconced in Cabinet as foreign minister.
It could still be that SPD members reject the proposals, leading the way for fresh elections.
But failure to secure votes for the new coalition would significantly undercut her political authority in the party and plunge the SDP deeper into crisis.More news: Here's how to turn off iPhone throttling with the iOS 11.3 beta
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