The 42-year-old actor, who played King Leonidas in the original film, said that the talks did not work out, reported Ace Showbiz.
"I'm not doing it. They're filming it right now. I wish them the best, but it didn't work out. It wasn't really my thing," Butler said.
"Battle of Artemisia" will focus more on Persian king-turned-god Xerxes, who leads an army against Greek forces.
Written by Zack Snyder and Kurt Johnstad, the movie will be directed by Noam Murro.
The film stars Rodrigo Santoro, who will play Xerxes, Sullivan Stapleton, Eva Green, Jamie Blackley and Jack O'Connell.