SNI Chief Constable Simon Byrne said he would not resign following a meeting with his oversight body that lasted close to seven hours.
His comments provoked anger among police officers, according to a representative body who are due to decide next week on whether to hold a no confidence vote.
The marathon discussions with the Policing Board were brought to a close on Thursday after a legal issue arose, which board members said they could not comment publicly on.
The DUP said it had not changed its position in calling for Mr Byrne’s resignation following the meeting, held to discuss issues raised by the High Court.
A judge on Tuesday quashed the actions taken against two junior officers after making an arrest at a Troubles commemoration event in Belfast in 2021.
Mr Justice Scoffield said the decision to discipline the officers was made to allay any threat of Sinn Fein abandoning its support for policing in Northern Ireland.
Unionists have accused Mr Byrne of taking unjustified action against the officers to placate republicans, while Sinn Fein has denied there was any threat to withdraw support for policing.
Ahead of the emergency meeting of the Northern Ireland Policing Board in Belfast, DUP leader Sir Jeffrey Donaldson said it was “time for change” at the top of the PSNI.
The senior police officer was already facing questions over a major data blunder which led to personal details of PSNI officers entering the public domain and getting into the hands of dissident republicans.
Following the meeting on Thursday, Mr Byrne said in a statement: “The deputy chief constable and I spent several hours in discussion with the Northern Ireland Policing Board surrounding the events of February 5-6, 2021,” he said.
“I highlighted that, after carefully reviewing the full judgment, I sought further advice. After consideration, the question of an appeal is now live.
“Further public commentary around this matter is not appropriate at this stage.”
Asked if he retained the confidence of the Policing Board, Mr Byrne said: “That is a matter for the Policing Board.”
When asked about his position, he said: “I’m not resigning.”
Chairman of the Police Federation for Northern Ireland (PFNI) Liam Kelly called the statement “hugely disappointing and unexpected” and said its members had been “infuriated” by it.
“He has previously publicly accepted the JR ruling, but now has gone volte face and is considering appealing it,” Mr Kelly said.
“If he does appeal, we expect he will use the PSNI budget which is already stretched to breaking point.
“In effect, he would be appealing against his own actions against his own officers, dragging this matter out both internally and externally.
“This has infuriated and antagonised the rank and file further and once again the two officers at the centre of the case are being treated disdainfully.”
The PFNI’s executive central committee is due to hold an extraordinary meeting next Wednesday where it will discuss whether to call a no confidence vote.
“It is hugely damaging to officer morale and confidence and has to be condemned.”
“I had hoped to refrain from saying anything publicly until the extraordinary meeting of my Executive Central Committee next Wednesday,” Mr Kelly added.
“However, such is the outrage that has been expressed by the rank and file, on behalf of the two officers and my colleagues, I feel I have no other option but to call it out – in short I am disgusted, disillusioned and extremely angry.”
Several members of the policing board emerged afterwards to state that a legal issue had arisen during discussions.
Policing Board chairwoman Deirdre Toner said board members had asked for clarity on matters raised in the judgment about an incident “deemed to be critical for policing”.
“After today’s discussions it has become clear that there are now legal issues that the board needs to consider and receive advice on,” she said.
DUP MLA Trevor Clarke said his position that Mr Byrne should resign as chief constable of the PSNI “has not changed”.
He said a legal issue had brought discussions with Mr Byrne to an end on Thursday evening.
When asked what the legal issue was, Mr Clarke said: “That would be a better question for the chief constable, given that it’s his issue. I think we need to give him space to explore what those options are on the basis of that.”
He said the issue had not been on the Policing Board’s “radar”, “to the extent that it became evident in the meeting”.
“It wasn’t there at the start of the process, but as the day unfolded that legal issue was presented,” he said.
Sinn Fein Policing Board member Linda Dillon said it was made clear by her party during the meeting that it did not threaten to withdraw support for policing.
She said: “I am content that we have made our position very clear that at no time did Sinn Fein threaten to either withdraw from the Policing Board or to withdraw support for policing and the rule of law.
“I still stand over what we said at the time that the treatment of Mark Sykes, the arrest and how that unveiled on the day, him a victim himself and the families that were there at a commemoration, was appalling.
“There can be no question about that.”
The incident happened on the Ormeau Road in February 2021 during a service marking the anniversary of the February 1992 Sean Graham bookmakers attack, in which five people were murdered.
The two officers faced action in 2021 after the arrest of Mark Sykes, a survivor of a loyalist gun attack on the bookmakers in south Belfast.
The incident unfolded when police challenged people attending a memorial event amid suspicions that the size of the public gathering breached coronavirus regulations.
Mr Sykes was handcuffed and arrested in chaotic exchanges captured on social media.
The incident triggered a major controversy at the time and sparked criticism of Mr Byrne.
Mr Byrne apologised for the PSNI’s handling of the event at the time, and it was announced that one officer was to be suspended and one repositioned.