The 26-year-old former Raith Rovers, Johnstone Burgh, Neilston, and Arthurlie frontman had caught Ton boss Allan Moore's eye after scoring 19 goals last season.
He also netted the same total the year before to fire the Stair Park side, which also included future Ton players Scott Taggart and Stephen Stirling, to the Second Division play-off final.
However, the fact Malcolm has a steady job outside of football meant that he was not willing to take the risk of going full-time.
Moore told the Tele: "I went to watch Stranraer in the play-offs last year and that's how I ended up signing Scott Taggart. He was bombing up and down the park and I thought, 'I like that boy.'
"I tried to get Craig Malcolm from Stranraer for next season but he knocked me back recently.
"He scored 19 goals for Stranraer this year and the year before, but he wanted to stay part-time because he's got a decent job and can't take the risk of going full-time."