The 49-year-old is believed to have emerged as Newcastle's first-choice target to replace Steve Bruce, with the Magpies hoping to have him in position for Saturday's Premier League clash with Brighton & Hove Albion.
Emery, who led the Yellow Submarine to a 2-0 win over Young Boys in the Champions League on Tuesday evening, has now confirmed that he is staying with the La Liga outfit.
"For all the noise there was yesterday in another country, inside the club there was transparency and loyalty with the Roig family and with my squad, which is at its maximum and for me is the most important thing," read the statement.
"Villarreal CF is my home and I am 100% committed. Honestly, I am grateful for the interest of a great club, but even more grateful to be here and that is why I communicated to Fernando Roig my decision to continue being part of this project, thanks to the commitment and respect that I feel from the club and my players, which is mutual and reciprocal.
"I want to thank the fans for the support they have given me always shown me. On Sunday we have a very important game and I hope we can all together get victory. See you at the Estadio de la Ceramica."
Emery, who has a contract with Villarreal until June 2023, has won four Europa League titles during his managerial career, including last season's competition.