how do I tell an employer that i am no longer interested in his/her job offer and want to cancel the job interview?

Polite call or email will do. But, if you have time go to the interview, if anything for practice. Who know what may happen. If you don't need or want the job, you are in control.

just tell them you recived a better offer

just be straightforward and honest. Call a few days before the interview and thank them for the opportunity. If you are honest and speak to them, if you ever need a job again, perhaps they would consider you again.

If it's because you discovered some reason you could never, ever possibly want to work for that employer, then maybe you save yourself and them time and cancel. I actually stopped an interview right in the middle when the interviewed made some statements that clearly indicated to me the lack of morality and ethics in their work environment. I simply stood up, politely told the interviewer that my brief time with them convinced me I could not work for them and permit my reputation to be associated with theirs, and left.
But otherwise, go. You may think you know what the job will be like, but you may find out something else at the interview. I went to an audition once and was told they were looking for someone for that role with a less "mature" look. I thought that was the end of that and started to leave, but they stopped me and apologized for not being more clear, I was completely wrong for the part they were auditioning for, but the actor playing the lead had just backed out and I was perfect for a much better role. You never know, it can't hurt to check it out.

Whatever you do, don't just NOT show up to the interview.

I would go anyway to pick up clues on do's and don'ts. It's nice to know you followed your nose in the right direction, which is what you'll probably learn, but it's also great to meet new people and experience their way of doing things in the business world. Practice makes perfect in interviews. I've learned more about people and what to avoid from the ones that didn't pan out. I have cancelled an interview or two in the past and the other party did not like being rejected without a chance to show themselves off. If you do cancel, be honest. They might try to change your mind if they feel strongly about you and make a prime offer.

Like was said above, call or email them and be polite. It won’t hurt their feelings, I assure you. They’ll actually be happy that you were courteous enough not to waste their time any further.

But if you have the time, go anyway. You know what they say, practice, practice, practice. Going to a lot of interviews over the years does wonders for your confidence, killing the stage fright and butterflies, enabling you to whip off professional, cogent responses to any question they could ask. Don’t look at it as a trial to be endured, look at it as an opportunity to build the kind of professional persona that will give you that all important edge over your competition.

Besides, it is an unhappy fact and I don’t really enjoy being the one to tell you this, but in many organizations, the hiring/interviewing process is just going through the motions. In too many cases, the employers already have a candidate chosen and practically ready to bring in their plants and knick-knacks. So, your odds may just be Slim and None and Slim just left.

Don’t let that discourage you from trying. Realistically, that is not always the case. If there are statistics available, perhaps some other member here would be so kind as to direct us to them.

um there is no way you got a JOB OFFER before having an interview of any kind.
does not work that way. you must have AT LEAST had one interview with them.

am i the only one who noticed that?

people dont accept job offers all the time. you dont even have to say why. you can just say i have evaluated my options and decided not to accept at this time.