Ball, a Heisman Trophy finalist and the Big Ten's offensive player of the year this season, announced his decision Thursday in Madison. He said the NFL draft advisory board gave him a third-round grade, which left him "disappointed."
He lost significant weight after the 2010 season, but plans to put on more weight in preparation for the 2012 season.
Ball said he's returning to "better myself, my stock and also my team."
ESPN draft analyst Mel Kiper Jr. ranks Ball as the nation's No. 5 junior running back.
"I'm just listening to my heart," Ball said. "I know for a fact I will come into this season better. No one knows what we're capable of this season but I know I made the right decision."
He called the decision to stay in school the hardest of his life.
He said he weighed everything, including injuries, his draft spot, another run at the Heisman Trophy and a promise he made to his parents to finish his degree.
He said he's not worried about an NFL payday and wants to make a permanent stamp on Wisconsin football.
"Maybe I'm not ready to leave all this behind," Ball said. "Right now my heart lies with the Badger family more than the NFL."
Ball earned consensus All-America honors and tied Barry Sanders' NCAA record for single-season touchdowns with 39. He led the nation with 1,923 rush yards, the seventh-highest total in Big Ten Conference history. His 2,229 all-purpose yards this season rank second in team history behind former Heisman Trophy winner Ron Dayne, who had 2,242 in 1996.
Ball has 51 rushing touchdowns in the past two seasons.
Meanwhile, reports in the Wisconsin State Journal and the Milwaukee Journal Sentinel said Friday that Badgers junior center Peter Konz will enter the draft.
Konz will make the jump after earning All-America honors this season. He started 31 games, although he missed three games this season with a dislocated ankle.
The team has yet to make a formal announcement about Konz, whom Kiper lists as the nation's top junior center.
Adam Rittenberg covers Big Ten football for ESPN.com. He can be reached at email@example.com. Information from The Associated Press was used in this report.