ALBANY – For New York Republicans, the surprise decision by Thomas Golisano to sit out this election means that the race for the GOP gubernatorial nomination has begun in earnest.

With the wild card out of the picture, at least for the time being, the key question is which candidate party leaders will rally around: William Weld, a charming and experienced politician who for months has been dogged by his connection to a bankrupt trade school, or John Faso, a conservative Albany insider from Columbia County who has loyal followers in the party base but is little known in New York City.

Both candidates will be vying for the support of the Senate majority leader, Joseph Bruno, party delegates, and the Conservative Party, whose leaders have expressed strong reservations about Mr. Weld’s stance on social issues such as abortion and gay marriage.

“It’s effectively a two-person race between myself and Bill Weld,” Mr. Faso said in an interview with The New York Sun.

A former minority leader in the Senate and the son of a custodian, Mr. Faso is likely to attack Mr. Weld on the issue of Decker College as the campaign gets more heated. Last year, Mr. Weld served as the interim chief executive of the Kentucky trade school, which slid into bankruptcy while being investigated for student loan fraud. Mr. Weld is not under investigation.

“It’s a steady drip-drip-drip problem,” Mr. Faso said.

Critics of Mr. Faso, meanwhile, increasingly drawing attention to his work as a registered lobbyist with the Manatt, Phelps & Phillips law firm, questioning whether a lobbyist is best suited to reform a dysfunctional state government. Mr. Faso, who became a registered lobbyist at a law firm after leaving office in 2002, when he narrowly lost to Alan Hevesi in the state comptroller’s race, said he is not currently a lobbyist.

Mr. Weld, a New York resident who was a popular governor of Massachusetts in the 1990s before abruptly leaving the political stage to enter the private sector, has doubled Mr. Faso’s fund-raising total and has received the endorsement of the party chairman, Stephen Minarik.

Attorney General Eliot Spitzer, the Democratic front-runner in the governor’s race, no longer faces the prospect of matching up against Mr. Golisano, a straight-talking business titan who is admired among upstate New Yorkers and might have spent $100 million of his fortune had he entered the race.

Instead, he will now likely face Mr. Weld or Mr. Faso, whose combined campaign war chest is less than what Mr. Spitzer raised in a single night of fund raising in December. One of the latest polls shows that Mr. Weld would lose to Mr. Spitzer by 43 percentage points. The Siena Research Institute poll didn’t inquire about Mr. Faso’s standing.

For the Republicans, Mr. Golisano’s decision “makes a terrible, hopeless situation even worse,” a noted political observer in Albany, Alan Chartock, said.

Yesterday’s election shake-up was not the news many Republican leaders in the state had been expecting. While delaying his endorsement of a candidate, Mr. Bruno strongly urged Mr. Golisano to run for office. At the top of the ballot, Mr. Golisano, with his sizable name recognition and fortune, might have aided lesser-known Republicans in the polls during an election that threatens to end the Republicans’ long-held control of the Senate.

A spokesman for Mr. Bruno said the state senator was disappointed by Mr. Golisano’s decision and that Mr. Bruno had not made up his mind as to which candidate he favors.

Mr. Golisano, 64, made his decision after wavering for months about whether to run a fourth time for governor. Those close to him say Mr. Golisano – who recently remarried, retired as chief executive of the successful payroll processing company he founded in 1971, and built a home in Florida – in the end was reluctant to take on the grinding job of governor at this stage of his life.

Instead, according to an adviser, Mr. Golisano is looking to play a behind-the-scenes role in the election, with plans to form a political action committee molded in the form of the MoveOn PAC, which supports the election of Democratic candidates and is partly funded by billionaire George Soros. He will also likely endorse a candidate, throwing his support behind a Republican or perhaps the Nassau County executive, Thomas Suozzi, whose warnings about massive fraud in the Medicaid system echo Mr. Golisano’s thinking on the subject.

“This guarantees that the Democrats will have the state office,” said Steven Pigeon, a former Democratic Party chairman of Erie County and a close adviser to Mr. Golisano. “The Republicans needed someone of Tom Golisano’s stature.” Mr. Pigeon said that up until the last moment, he thought Mr. Golisano would jump into the race.

Just after Mr. Golisano’s announcement, Republican candidates phoned county party leaders, delegates, and other state GOP leaders to try to shore up support for their campaigns.

Those calls primarily targeted party chairmen, particularly those in counties with Republican strongholds, who have withheld their endorsements in anticipation of a Golisano candidacy.

Lying low but still in the race is Randy Daniels, a former CBS correspondent in Africa who served as secretary of New York State under Governor Pataki and is the only black gubernatorial candidate. While Mr. Daniels has raised less than a millions dollars, he is trying to position himself as an alternative should the Weld and Faso campaigns fall flat.

“The race is wide open,” a spokesman for Mr. Daniels, Robert Ryan, said. “Tom Golisano talked about reform and Randy Daniels is going to carry the message of reform.”