Liverpool have turned down Manchester City's follow-up bid of around £40m for Raheem Sterling, according to Sky sources.
City, whose initial £25m bid was rejected last week, tabled a second offer of around £40m on Wednesday as they stepped up their pursuit of the England international.
Sky Sports News HQ reporter James Cooper said: "At this stage it seems Liverpool don’t want to do business and it looks like City will have to increase their offer if they want to get the England winger.
"It will be interesting to see if they decide it wasn't their final offer and opt for something closer to Sterling's reported value of £50m. There will be a few more twists and turns to come."
Sky sources reported on Tuesday that Chelsea were also interested in signing the 20-year-old but were not prepared to meet Liverpool's valuation for the forward.
Sterling, who has been involved in protracted discussions over his future at Anfield and saw his form slip towards the end of the season, is refusing to sign a new long-term contract and a number of Europe’s top clubs are monitoring the situation.
Liverpool have maintained publicly that the player is not for sale and manager Brendan Rodgers insisted last month that he expected Sterling to stay for the remainder of his current deal, which still has two years left to run.
But City's chairman Khaldoon Al Mubarak said last week that his club are planning to heavily invest in new players this summer and it is believed Sterling tops the list of targets.
Al Mubarak said: "You will see us in the market bringing in high-quality individuals that fit within what we are aspiring to.
"We want a squad which is able and has the capability and quality to win the Premier League, to compete and win the Champions League and be able to go all the way in two cup competitions in England."