ZEC chairman Simpson Mutambanengwe, in an interview with the German Press Agency dpa, said the ZEC did not have the funding to organize a free and fair ballot.
And even if it did, the process of drafting a new constitution – a precondition for the elections – was running far behind schedule.
"I know politicians have been talking about it, saying there is going to be elections next year," Mutambanengwe, a Zimbabwean-born retired Namibia Supreme Court judge, said.
But only the ZEC could determine whether the conditions for the holding of elections were in place, he told dpa.
Last month Mugabe said he wanted elections to replace the transitional government he formed last year with Prime Minister Morgan Tsvangirai to take place by the middle of next year.
Finance Minister Tendai Biti said Mugabe had asked him to set aside 200 million dollars in next year’s 2011 budget for the elections.
But that money, if allocated, would only be made available in January at the earliest.
Mutambanengwe, who was appointed to the head of the ZEC by Mugabe and Tsvangirai, said the ZEC needed the money "immediately."
"If the funds are made immediately available for us to carry out preliminary operations then we will be ready to carry on elections."
One of the biggest challenges facing the ZEC is to overhaul the voters roll.
Tsvangirai has complained of the register being inflated with ghost voters and demanded it be drawn up from scratch.
Mutambanengwe agreed that the roll had to be in a condition "that is acceptable and that satisfies all stakeholders."
Zimbabwe’s 2008 power-sharing agreement also states that elections can only be held after Zimbabweans vote on a new constitution.
Yet, the process to draft a new constitution is running more than 12 months behind schedule and is slated to be completed only in April at the earliest. Then the document has to be put to vote.
"Some of the suggestions that we are going to have elections next year would seem to imply that the elections would be held without a new constitution," Mutambanengwe said. "If that is the case we wait to be advised."
MacDonald Lewanika, head of the Crisis in Zimbabwe Coalition, a federation of human rights groups, said the squabbling between Mugabe and Tsvangirai had led many to believe that elections were the only way to speed up reforms.
"But clearly, the ZEC is not ready for elections. The environment is not yet tenable for a credible election. Zimbabweans are still traumatised by the violence that rocked the country in the last elections," Lewanika said.
The last elections in Zimbabwe in 2008 turned violent after Mugabe lost the first round of the presidential poll to Tsvangirai.
Tsvangirai withdrew from the second round over the killing of dozens of his supporters in the violence after the first round.
Mugabe declared himself the winner but African leaders refused to recognise the outcome and forced him to go into coalition with his arch-rival.
Analysts have warned that hastily-organized elections could see a repeat of the 2008 events.