Speaking at the D: All Things Digital conference in California this week, Yang said: "Microsoft is no longer interested in buying the company, and we are talking about other things. We definitely have to understand what they're proposing...they clearly have an interest in Yahoo, and we need to understand more."
"We did not walk away from that proposal. Microsoft did," Yang added.
Yang also said that a deal between the two companies would have made sense, creating a "tremendous amount of power."
Speaking at the same conference, Microsoft chief executive Steve Ballmer confirmed the deal was no longer on the table and reiterated that Microsoft was "not rebidding for the company, [but] we reserve the right to do so."