Kobayashi, one of the world's premier competitive eaters, won the contest for six years up to 2007 and then had to settle for second-place finishes behind American Joey Chestnut. He moved to New York in March so he could train with local hot dogs.
But his chances of getting revenge this weekend against Chestnut, from San Jose, Calif., seem slim because of a contract dispute with the event's organizer. Kobayashi, 32, has balked at signing an exclusivity clause with the group, and can't compete unless he does.
"I really want to compete in the event," Kobayashi told Japan's Kyodo news agency.
In a report from New York on Friday, Kyodo quoted Kobayashi as saying the event "holds a special place in my heart," but added he did not agree with the conditions.
Kobayashi became a celebrity and a hero in Japan by eating his way to victory from 2001 to 2006, a feat that remains unmatched.
But Chestnut has won the title for the last three years, setting a world record by scarfing down 68 hot dogs and buns in 10 minutes last year. Two years ago, Chestnut beat Kobayashi in a five-dog eat off, after they tied at 59 franks each.
Chestnut says he still sees Kobayashi as a rival - and a bitter one. They don't talk to each other, and did not shake hands after last year's eat off. Kobayashi lost to Chestnut last year by only 3 1/2 hot dogs.
In May last year, Kobayashi beat Chestnut in a pizza eating contest, consuming 5 3/4 pizzas in six minutes. Each pizza weighed one pound (0.45 kilogram). Chestnut could only manage 5 1/2 in that time.
If Kobayashi is out of the game, Chestnut's toughest opponent may be Bob Shoudt, the world's No. 2 eater, and Patrick Bertoletti, ranked No. 4 in the world.
The 95th annual hot-dog eating contest will take place in Coney Island, Brooklyn on Sunday. U.S. TV viewers can catch the spectacle on ESPN.
The contest has been held every Independence Day since 1916.