The soap actress, who played Frankie Baldwin, will appear as Peter Pan in Nottingham's Theatre Royal pantomime instead.
Stephenson has reportedly been offered twice as much cash to appear in the panto than she would have received had she gone to the jungle.
Her six-week run in Nottingham will earn her £150,000, while ITV bosses were offering only £75,000 for her to appear on the reality TV show, according to The Mirror.
A friend of the actress commented: "What a sensible girl! She's been very shrewd about it all."