David Beckham is set to return to Los Angeles Galaxy next month after head coach Bruce Arena revealed AC Milan failed to produce an "acceptable offer'' before Friday's deadline.
Major League Soccer commissioner Don Garber had warned the Italian club, where Beckham is on a short-term loan, they had to agree a deal by then if they wanted to sign the England midfielder permanently.
But Arena, coach and general manager of the Galaxy, issued a statement saying no transfer materialised and Beckham, 33, will return when the loan expires.
"Today's deadline imposed by Major League Soccer Commissioner Don Garber regarding a resolution of David Beckham's potential transfer to AC Milan has passed and we did not receive an acceptable offer for the player.
"As a result, David remains an LA Galaxy player and we look forward to having him back with the club starting March 9.''
In reality a move could still go through despite the deadline imposed by the Americans.
Garber set the time limit as both the Galaxy, opposing teams and league officials step up preparations for the new season - with Beckham's presence significantly affecting ticketing and team affairs.
Garber, who would have to approve any deal, said in the week: "There is no reason why this should drag on. They (AC Milan) either want to do it or don't want to do it. This Friday we need to know if they want to buy David Beckham or not.
"What they need to realise is that we are getting very close to the start of our season,'' he said. "We have to figure out what plans we need to make and if David Beckham is going to be a part of those plans.''
Milan are still keen to sign Beckham and the player wants to remain in Serie A, so a deal could well be reached in the next few days.
However, the chief executive of Galaxy owners AEG, Tim Leiweke, told the Los Angeles Times that Milan did not meet Friday's deadline and that no late offer would be considered.
"He will be back here on March 9, and we don't want to entertain any more conversations now,'' Leiweke said. "It is a distraction to (Galaxy coach) Bruce Arena, the team and the fans, and we move on. That's the last we're going to talk about this.''
Asked what would happen should the Italian giants return with an improved often now the deadline had passed, Leiweke was clear.
"They'll come back (with another offer), sure they will. But we owe it to our fans (not to consider it),'' he said.
"They've been reading all these stories, and we lose credibility by the day. That's not fair. We owe it to Bruce and we owe it to the rest of the team. We're a month away from our season.''
Last week, the Galaxy rejected Milan's first bid for Beckham, saying the England midfielder would return to Los Angeles as scheduled unless the Italians came up with a higher offer.
Milan coach Carlo Ancelotti had urged the Rossoneri to go the extra mile in order to keep Beckham at the San Siro after the Englishman earned a regular spot in the starting XI since his arrival in January, and has set up goals and scored for the Rossoneri.
However, Leiweke insists Milan's offers have never come close to meeting AEG's and the league's asking price of more than £10m.
"They've never been in the ballpark,'' he said. "What they've tried to do is use David and use us. We're not going to play that game any more. This has been extremely damaging and distracting for our team.
"I've been as courteous and as gracious as I possibly can out of respect for David, but now it's time to move on. We need to get David excited about the team we're building here and coming back.''
Leiweke also did not think Beckham would consider buying himself out of his contract in order to complete the move, even though the England midfielder has made it clear he wants to make his short-term spell in Serie A permanent.
"I doubt it,'' Leiweke said. "I don't think that's his intent. Nor would I encourage him to even think about that.''