Both Fonseka and Rajapakse are members of the majority Sinhalese community and if their candidacies split the Sinhalese vote, then support from the island's ethnic minorities, which usually vote en bloc, could tip the scales.
"We have decided that we shall not extend our support to president Mahinda Rajapakse," TNA leader R. Sampanthan told reporters. "We have decided to support the common opposition candidate Sarath Fonseka."
Both the main candidates have been trying to woo the minority vote, but Sampanthan said Fonseka had been the more "receptive" of the two.
The TNA, which was seen as a proxy of the Tamil Tiger rebels who were crushed in May last year, had called a boycott of the November 2005 presidential vote which was narrowly won by Rajapakse.
Fonseka, who is credited with leading the military drive against the Liberation Tigers of Tamil Eelam (LTTE), promised earlier this week to establish a completely civilian administration in the island's former war zones.
Rajapakse had called the early January poll to capitalise on popular applause for the victory over the LTTE, which launched its campaign for a Tamil homeland in 1972.Fonseka and Rajapakse have been at loggerheads since the end of the conflict. Fonseka quit after accusing the government of sidelining him and falsely suspecting him of trying to stage a coup.