Armstrong, speaking on a telephone conference call from a cycling trade show in Anaheim, California, said his decision stemmed from good news he received during a doctor's visit last week in Indianapolis.
Armstrong said: "They were extremely optimistic - I'd never seen that from them before. Before, they were hesitant and cautious what they said to me."
Armstrong's cancerous testicle was removed on 3 October, the day after diagnosis. But soon it was discovered that the disease had spread to his lungs, stomach and brain. Chemotherapy and brain surgery followed.
Armstrong, who lives in Austin, Texas, added that doctors told him the chances of future surgery were "almost zero" and death is almost "totally out of the picture".
Last week's news was not all good. Cofidis, the French cycling team, told Armstrong it would not exercise the second year of a two-year contract, forcing him to seek another team.
His agent, Bill Stapleton, said they have between four and six weeks in which to find a new team. Armstrong said he has not had the chance to discuss contracts yet.
Stapleton said he and Armstrong "haven't even thought" about what they would do if a team cannot be found. Armstrong probably would not consider riding in races in the US.
Armstrong said: "I consider myself part of the European [cycling community]. That's what I want to return to."
Armstrong plans to return to a serious training schedule by November at the latest and is riding for two hours a day.
He said: "I didn't just take a year off. It's a year in which physically I went through a lot of hard stuff. Tests indicate nothing has changed for me physically. So, it's just a question of how much did I lose by taking a year off?"
He said that he was "very curious" about how well he will be able to ride in 1998.Reuse content