The typed document, signed by the Indian Hindu activist and dated 6th April 1926, was written to Milton Newberry Frantz, a Christian elder in the US at the time.
Replying to a letter Frantz had sent him about his faith, Gandhi wrote: "Dear Friend, I have your letter. I am afraid it is not possible for me to subscribe to the creed you have sent me.
"The subscriber is made to believe that the highest manifestation of the unseen reality was Jesus Christ. In spite of all my efforts, I have not been able to feel the truth of that statement. I have not been able to move beyond the belief that Jesus was one of the great teachers of mankind."
Gandhi went on to state the importance of respecting all people's faiths as all religions are based on a "common thread of love and mutual esteem".
The iconic independence leader is revered in India and known as the 'father of the nation'. He wrote extensively about Hinduism's philosophy and teachings.
The letter had been in a private collection for decades and was sold by the Pennsylvania-based Raab Collection.
The Raab Collection said in a statement that their "research discloses no other letter of Gandhi mentioning Jesus to have ever reached the public market."
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