With uncertainty continuing to surround the future of Harry Kane, Nuno Espirito Santo's side were thought to be making progress in their efforts to sign Martinez from cash-strapped Inter.
However, the Scudetto winners' coffers have been boosted from the £97.5m sale of Romelu Lukaku to Chelsea, and Inter CEO Marotta has now confirmed that Martinez has made a decision on his Inter future.
Speaking to DAZN, Marotta said: "Lautaro Martinez has decided to stay at Inter, he strongly wants to stay also with many clubs approaching us with official bids to sign Lautaro. We're so proud."
The Argentine is therefore expected to pen an extension on his existing deal with expires in 2023, and he registered 17 goals and 10 assists from 38 Serie A games last season.
While Kane's future at Tottenham is still not secure, Daniel Levy is supposedly refusing to accept Manchester City's calls, and the 28-year-old has travelled with the team to face Wolverhampton Wanderers on Sunday.
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