Nicollin said earlier this week that he was serious about appointing the Argentine to succeed Rene Girard at the end of the season.
However, Nicollin has now claimed that Maradona's move to the Ligue 1 side has fallen through.
"No, Maradona will not come to Montpellier. There are too many agents involved in this affair for my liking," he told L'Equipe.
"It's all a bit of a mess and I have had enough of it. Not of Maradona, but of all the agents involved. The entire story is giving me a headache."
Maradona has been out of work since leaving United Arab Emirates side Al Wasl in 2012.