After Microsoft withdrew its unsolicited bid for Yahoo, the word was that the courtship was kaput. Microsoft said it had moved on, but two weeks later, it seems both sides have revived their flirtation.

In a statement issued on Sunday, Microsoft announced it was in talks with Yahoo about a possible partnership, while hinting at another takeover bid in the future.

Microsoft is "continuing to explore and pursue its alternatives to improve and expand its online services and advertising business," and the companies are discussing an "alternative that would involve a transaction with Yahoo but not an acquisition of all of Yahoo," the statement said.

Sources say the talks involve a joint-venture for search-related advertising that would likely involve ads sold by Microsoft appearing alongside Yahoo search results to battle Google's share of the market, according to The New York Times.  

Yahoo is currently working toward a similar partnership with Google that would enable Google to sell ads against Yahoo search results. That deal would need to be approved be regulators before it went through.

While the current discussions do not include a full acquisition of Yahoo, Microsoft kept the door open for a possible takeover and said it "reserves the right to reconsider" another bid in the future.

Yahoo, in turn, issued a vague statement that said, "Yahoo and its Board of Directors continue to consider a number of value maximizing strategic alternatives for Yahoo, and we remain open to pursuing any transaction which is in the best interest of our stockholders."

Meanwhile, Yahoo's internal affairs are a complete mess. Many shareholders were up in arms when the company refused Microsoft's original $47.5 billion bid, and chief Jerry Yang is facing the possibility of losing the company he co-founded. At the same time, activist investor Carl Icahn launched a proxy battle for control of the company last week. Icahn recently amassed a stake in Yahoo and hopes to replace Yahoo's current board of directors with his own personal choices in the hopes of renewing talks with Microsoft.