The 38-year-old centre-back played for Rangers' Under-23 side on Monday after training with Ian Holloway's side for the past week.
But the club have announced that Hill will remain a free agent after not agreeing a deal.
"The parties were unable to reach a satisfactory arrangement going forward and therefore Hill will not be rejoining QPR," read a club statement.
The veteran defender made 185 appearances for QPR over a six-year period with the club, captaining the club and helping them win promotion from the Championship in 2010-11 and 2013-14.
Hill was not offered a new contract by Scottish top-flight side Rangers in July and has been a free agent since.