Not true, people!! Having been the rejector quite often, I can tell you from honest experience, it's not true! Let's consider some possible scenarios.
Galleries. First, you have to understand how galleries work. Every single gallery out there has a well-defined group of people--called their target market--who they have nurtured as their customer base. The gallery director knows what those customers want and how much they'll pay for it. He or she is looking for artists whose work will appeal to that target market and bring them into the gallery and inspire them to buy. So among the many possible reasons a gallery director might reject an artist is because a) the artist's work is too different from what is in the gallery and won't appeal to the pre-defined target market (and widening the range of offerings will require too much of an investment of time and money to attract a broader audience), b) the artist's work is too similar to another artist already selling well in the gallery, c) the artist's work is at the wrong price level (either too high or too low) for the target market, or d) the gallery is representing the maximum number of artists they can comfortably handle. Notice how none of these reasons have anything to do with the quality of the artist's work.
Competitions. When a juror selects entries for a competition, he or she is usually curating a show, which means choosing a collective body of work that will look good together. So once the juror has picked out all the best pieces, he or she then has to look at them as a whole. There might be too many landscapes or too many figurative pieces, so good pieces are rejected to strike a better balance. Ditto for styles. Or maybe a really good piece just doesn't fit well with the rest. Or maybe there was a theme for the show, and a really good piece doesn't fit the theme. Notice how none of these reasons have anything to do with the quality of the artist's work.
Magazines and other press coverage. An art magazine editor goes through the exact same curatorial process when selecting artists to feature in future issues, with the extra consideration of what has recently been featured. An editor wants to offer variety, not near repeats. And of course, a major reason editors and producers of all types will reject a proposal is that the artist didn't offer a compelling "hook" or angle for the text part of the article. Notice how none of these reasons have anything to do with the quality of the artist's work.
My friends, in our fast-paced universe, no one is going to take the time to write a personalized note explaining why they rejected you from something. So you'll rarely--if ever--know why you've been rejected. But with so many possibilities, why assume it means your work is bad? Have faith in yourself, keep striving to be the best you can be, and always put your best work out there.