Versatile player was linked with a move away.
Bundesliga giants Dortmund had offered Hudson-Odoi the chance to feature in his favoured left wing role, but Chelsea rejected any move out of hand.
Blues boss Tuchel revealed the Stamford Bridge club could not allow the 20-year-old to leave, with the young England star’s ability to feature at wing-back vital in west London.
Hudson-Odoi notched his 100th Chelsea appearance in Saturday’s 3-0 Premier League win over Aston Villa where he featured at right wing-back, left wing-back and also left wing.
Asked about keeping Hudson-Odoi in his squad, Tuchel said: “It was a very easy decision for me, we cannot let the player go who is in an 18, 19 man squad. Simply impossible.
“He is able to play as a right wing-back, left wing-back, he can play in these extra positions, he knows the group and we know him very well.
“For him personally it would maybe have been a very good opportunity but for us it was simply impossible.”
Romelu Lukaku fired his first-ever Stamford Bridge goals in a stunning brace as Chelsea overwhelmed a manful Villa.
Mateo Kovacic teed up Lukaku’s opener before dinking home a neat finish of his own.
Chelsea’s three wins and a draw from their four matches has put them second in the Premier League, trailing leaders Manchester United only on goals scored.
Hudson-Odoi’s versatility might be vital for Tuchel but the Chelsea boss is well aware the talented wide player craves a run in a more advanced role.
Chelsea’s German manager praised Hudson-Odoi’s level in training, then challenged the Wandsworth-born star to replicate that in match action.
“I see a stronger, stronger Callum every day in training, overcome the gap between training and playing,” said Tuchel.
“And now he needs to show that in matches. If he gets minutes it’s never a gift. Nobody gets gifts.
“I know it’s not his favourite position but I think he can play this position and serve the team very well.
“But still he can do better, still he can be more aggressive, and that’s what he does in training.
“He needs to overcome this gap between training and playing, to fight for his place in this team.”
Villa have just one win from their four matches in the new campaign, but John McGinn believes Dean Smith’s side can take encouragement from elements of their Stamford Bridge showing.
“It’s a tough one, Chelsea are a tough team but the first-half I thought we were better,” McGinn told Aston Villa’s official club website.
“We made chances to score but didn’t take them.
“We were brave in the way we played, second-half the mistake gave them a foothold and momentum.
“There’s not many teams that will come and challenge Chelsea the way we did in the first-half, but the way we want to go and the places we want to go we want to come here and get at least a point.
“Overall disappointing but the signs are there that we are starting to play and create chances, which we weren’t doing before tonight.”