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Microsoft’s attempt to buy Yahoo in February may have been rejected, but, as anyone who’s been paying attention for the past few months knows, the potential deal is not exactly dead.

So what’s the status? It’s hard to say. Depending on what news source you’re paying attention to, the two companies are either working together to negotiate a new price, or bickering back and forth about matters of stock value and market share. (The truth is probably both.)

For example, the Earth Times weighed in today with a story called “Yahoo not opposed to Microsoft deal at right price,” the very title of which seems to suggest that somewhat friendly negotiations are continuing:

Yahoo Inc is not opposed to Microsoft Corp’s bid for the Web media company, as long as it is at the right price, Yahoo’s board said on Monday in a letter to Microsoft chief executive Steve Ballmer.

“We have continued to make clear that we are not opposed to a transaction with Microsoft if it is in the best interests of our stockholders,” the letter said. “Our position is simply that any transaction must be at a value that fully reflects the value of Yahoo, including any strategic benefits to Microsoft, and on terms that provide certainty to our stockholders.”

Today’s MarketWatch, however, in a story called “Yahoo fires back after Microsoft threat,” paints a bit more competitive picture:

Yahoo Inc. fired back at Microsoft Corp early Monday morning after the software giant threatened over the weekend to launch a proxy campaign and reduce its offer for the beleaguered Internet portal.

The battle escalated shortly before the opening bell after Yahoo on Monday said the decline in the software giant’s own shares makes its takeover bid even less attractive than when it was originally rejected.

Yahoo also blasted as “counterproductive” Microsoft CEO’s statement that the Web portal has three weeks to negotiate a deal or face a hostile takeover campaign.

The exchange made clear that price appeared to be the biggest stumbling block to the merger, as Microsoft stressed its belief that its offer, initially valued at $44.6 billion, is full and fair - a position Yahoo again rejected in the latest exchange.

“We continue to believe that your proposal is not in the best interests of Yahoo and our stockholders,” Yahoo CEO Jerry Yang and Chairman Roy Bostock said in a letter to Microsoft CEO Steve Ballmer.

Over the weekend, Ballmer pointed to “public indicators” that he said showed a decline in Yahoo’s search and page views.

But Yang and Bostock countered with their own dig at Microsoft’s fortunes saying, “As a result of the decrease in your own stock price, the value of your proposal today is significantly lower than it was when you made your initial proposal.”

Stay tuned; we’ll continue to follow this story as details unfold.