In the summer of 2009, Dudley, a Lake Oswego resident, was encouraged by the Republican Party to consider a run for the U.S. House of Representatives. Dudley declined to run for Congress, preferring to spend more time in the state. On October 11, 2009, "The Oregonian" reported that Dudley was considering entering the Republican primary for Oregon governor in 2010. In November 2009 he formed a campaign committee and raised roughly $340,000 by early December of the same year. Dudley formally announced his entry into the race on December 16. On March 6, 2010, "The Oregonian" reported Dudley had raised over $1 million, aided by a $50,000 donation from Nike co-founder Phil Knight.