Mr Zelaya's supporters say he remains the rightful leader of Honduras
Two days of talks on the political crisis in Honduras have broken down without agreement.
The interim government's top delegate called a proposal that ousted President Manuel Zelaya return as leader of a unity government "unacceptable".
Representatives of Mr Zelaya at the talks in Cost Rica said they would have have no further talks with the delegation.
Mediators have asked both sides to resume talks in three days.
"It was not possible to reach a satisfactory agreement," said President Oscar Arias of Costa Rica, who is leading mediations and has presented both parties with a seven-point proposal.
"The Zelaya delegation fully accepted my proposal, but not that of [interim President] Don Roberto Micheletti."
Mr Arias has warned of possible civil war if the talks fail and urged both sides to continue.
"My conscience tells me that I cannot give up and must continue working for at least three more days and that is what I propose to do," he said.
Mr Arias has warned of possible civil war if the situation is not resolved
Mr Zelaya, who is in Nicaragua, accused the interim government of defying the international community.
"The regime that is ruling Honduras by force is showing that besides being irresponsible, it is also disrespectful, arrogant and intransigent," he said.
He later said his supporters were "organising internal resistance" in preparation for this return to the country. Mr Zelaya has already made one failed attempt to return to Honduras.
The US, which has supported Mr Zelaya, urged the political rivals to reflect on the "significant progress" made at the talks and to "commit themselves to their successful conclusion".
State Department spokesman Robert Wood said the Organisation of American States (OAS) and other interested parties "underscore their commitment to the peaceful resolution of political disputes through dialogue".
The talks broke up over the issue of Mr Zelaya's return.
"I'm very sorry, but the proposals that you have presented are unacceptable to the constitutional government of Honduras," said Carlos Lopez, the head delegate for the interim government, led by Roberto Micheletti.
Manuel Zelaya said it was his right to return to Honduras
He said Mr Micheletti's side objected in particular to the first point of Mr Arias's plan, which proposes "the legitimate restitution" of Mr Zelaya as the head of a reconciliation government until early elections are held in October.
Mr Arias also proposed an amnesty for political crimes committed before and after the 28 June coup.
Mr Zelaya's representatives had previously said they accepted the proposal for reinstating the deposed leader and were "willing to discuss all the other points".
But following Sunday's statement from the interim government, the delegation said the talks were effectively over, although it had not ruled out future talks with the coup leaders.
"This dialogue with this commission of the de facto, military coup government is finished," said Rixi Moncada, one of Mr Zelaya's representatives.
Troops forced Mr Zelaya into exile on 28 June over his plans to hold a non-binding public consultation to ask people whether they supported moves to change the constitution.
His critics said the move was unconstitutional and aimed to remove the current one-term limit on serving as president, paving the way for his possible re-election.
Mr Zelaya has vowed to return home, but the interim government has said he will be arrested if he comes back. It prevented an earlier attempted homecoming by air on 5 July.
The BBC's Charles Scanlon, in the region, says it would not be hard for Mr Zelaya to cross the long and mountainous border between Nicaragua and Honduras, but there is great concern that it will lead to bloodshed if he does.
Mr Arias said he was concerned that a "good part" of the Honduran population own firearms.
"What happens if one of those arms shoots a soldier? Or if a soldier shoots an armed civilian?
"There could be a civil war and bloodshed that the Honduran people do not deserve," he said.