Alabama coach Nick Saban confirmed Monday that Smart would be remaining with the Crimson Tide. Georgia made a hard push to get Smart, offering him a multiyear deal in excess of $700,000 annually. It is believed Georgia's offer is at least a three-year contract.
"I think it was pretty well known that there was an opportunity to return to my alma mater as defensive coordinator. I wouldn't even have considered discussing the position with any other school, but when it is a place I've spent some of my best years and had some great memories, I thought it was something I should discuss with my family and figure out what was best," Smart said in a statement released by the school.
Smart, a native of Bainbridge, Ga., is a former defensive back at Georgia and coached at his alma mater during the 1999 and 2005 seasons. He has been a member of Nick Saban's coaching staffs for all but one season since 2006.
"After thinking about all the factors over the last couple days, we are going to stay at the University of Alabama. We love it in Tuscaloosa, have made some great friends here and I think we are building something special here at Alabama with Coach Saban. I have learned so much in the time I've spent with Coach Saban, and every year I feel like I become a better coach," Smart said in the statement.
"I've got a great deal of respect for Coach Richt and the job he has done there and the University of Georgia will also have a special place in my heart. Not only did I play there, but my wife [Mary Beth Lycett] played basketball there and we have a lot of friends at UGA.
"At the end of the day, I just feel like this is where I am supposed to be and this is a special time to be at the University of Alabama."
Smart, the Broyles Award winner this year as the top assistant coach in college football, will get a considerable bump in salary to stay at Alabama. Smart earned $369,350 last season, among the top coordinator salaries in the country. Tennessee defensive coordinator Monte Kiffin is the country's highest-paid assistant, earning $1.2 million per season. Texas defensive coordinator Will Muschamp, who last year was named coach Mack Brown's eventual successor, makes $907,500 annually.
"We're very pleased and happy that Kirby is going to be staying here at the University of Alabama with us," Saban said. "He's done a fabulous job for us. He's one of the finest assistant coaches in the country. You expect guys like Kirby to get lots of opportunities to do things, and we want to continue to help him continue to develop his career here so that when he leaves here it's going to be to be as a head coach and probably in a very good situation. So we're excited about that. We're happy for him and his family. It's very pleasing to us."
Under Smart's direction, Alabama finished No. 2 nationally among FBS teams in total defense (244.1 yards per game), pass-efficiency defense (87.6 rating), scoring defense (11.7 points per game) and run defense (78.1 yards per game).
The Crimson Tide defeated Texas 37-21 in Thursday night's Citi BCS National Championship Game at the Rose Bowl.
Georgia has been searching for a new defensive coordinator since Dec. 2, when Richt fired longtime coordinator Willie Martinez. Georgia finished 38th in total defense (339.3 yards per game) and 63rd in scoring defense (25.9 points). The Bulldogs allowed 30 points or more five times in 2009.
Richt is now expected to focus his search on Dallas Cowboys defensive line coach Todd Grantham, another former Saban assistant. Grantham, who is in his second season with the Cowboys, was defensive coordinator for the Cleveland Browns from 2005 to '07. He also worked as a defensive line coach with the Houston Texans and Indianapolis Colts and worked six seasons as an assistant at Virginia Tech, his alma mater. Grantham was the defensive line coach on Saban's Michigan State staff from 1996 to '98.
Sources told ESPN.com that Richt has contacted Hokies coach Frank Beamer about his former player and assistant.
Information from ESPN.com's Mark Schlabach and Chris Low is included in this report.