The Welsh giants have been keen to bring Davies in to take over, but saw their first approach for his services fail.
They have been tipped to go back in with another effort to appoint Davies, however the assistant will now be staying with Tottenham.
Davies will not become the new Swansea boss and the Championship outfit will need to look elsewhere.
Tottenham will be boosted by being able to keep hold of the 38-year-old, with the north London side having been set against losing him.
Davies only arrived at Tottenham in the summer to assist Ange Postecoglou and is an important part of the Australian’s backroom team.
He will now put his full focus into helping Tottenham to enjoy a successful campaign.
Swansea, who sit in 18th spot in the Championship table, were beaten at home by Middlesbrough on Saturday afternoon.
