Sjöstedt said in an interview with news agency TT in October that environmental politics is an area that clearly separates him from Ohly.
"If one were to point something out it would be the environmental questions," Sjöstedt said.
"In that regard this party has fallen behind and left the whole field to the Green Party."
Former Left Party candidate Hans Linde said he respects the recommendation, and that he believes Sjöstedt would make a great leader for the party.
"I have decided to withdraw my candidacy for the post as party leader," Linde said.
Linde believes Sjöstedt's most important task will be to lead the change process within the party so that they can "be a party that can win elections."
In the TT interview Sjöstedt was described as a "convinced socialist."
"I argue that socialism is a current and necessary ideology. Not least when the capitalist financial world is in deep crisis and when the solutions are about spreading the influence of democracy to the economy, and limit the power of capital," he said in October.
Sjöstedt is also in favour of collaboration between his own party and the Green Party, and suggested the two do as their counterparts in Norway and openly declare their willingness to govern together.