Manuel Zelaya slipped back into Honduras in September
Envoys for ousted Honduran President Manuel Zelaya say talks with the interim government have broken down.
Mr Zelaya's team of negotiators had set a deadline of the end of Thursday for the interim government to agree to terms allowing his return to power.
However, negotiators for interim leader Roberto Micheletti said that although they had rejected the deadline they were still open to dialogue.
They said they would present a new proposal to Mr Zelaya on Friday.
Mr Zelaya, who was ousted in late June, is currently taking refuge in the Brazilian embassy in the capital, Tegucigalpa.
His term of office is due to end at the end of January and presidential elections are scheduled for the end of November.
Analysts say the stumbling block is whether Mr Zelaya can return to the presidency ahead of those elections.
On Thursday his negotiators set the midnight deadline and called on Mr Micheletti to take heed of international calls for Mr Zelaya's reinstatement.
When it expired, negotiator Mayra Mejia said: "We consider the dialogue has been exhausted, we cannot continue to give deadlines."
But Mr Micheletti's negotiator, Vilma Morales, was unmoved by the deadline.
"This committee, having categorically rejected the midnight ultimatum... states that our answer or counter-offer will be presented tomorrow at 1000 (1600 GMT) Friday," he said, AFP news agency reported.
Mr Zelaya's camp accuses the interim government of using delaying tactics to prevent the ousted leader serving out his remaining weeks in power before the election.
Mr Micheletti's team rejects this. They have proposed that the country's Supreme Court and Congress should submit official proposals to the negotiating commission on Mr Zelaya's possible reinstatement.
The Supreme Court ruled that Mr Zelaya had violated the constitution in June, while Congress voted to remove him from office.
Mr Zelaya was sent into exile on 28 June after trying to hold a vote on whether a constituent assembly should be set up to look at rewriting the constitution.
Despite attempts by the interim government to keep him out of Honduras, he made a surprise return in September when he took refuge in the Brazilian embassy.