The 29-year-old's representative is already looking for a new club for his client after the Bianconeri refused to lower their asking price for the player.
The Brazilian midfielder enjoyed an impressive season on loan at the Turkish giants after failing to impress in his first two years at Juventus following a 18.5 million euro switch from Fiorentina.
Last week, Melo's father was quoted as saying that the Bianconeri were playing hardball over their valuation of the player, and his representative has now indicated that the Istanbul club has pulled out of talks for the player.
"Today the Galatasaray management made a new request for a reduction," Jose Rodriguez Baster told the Anadolu News Agency. "The effort shown by the player is not seen as significant by the club. Melo has thanked Fatih Terim for his patience since the start of the negotiations. We believe that Terim is doing everything he can for the deal.
"The fact that an agreement could not be reached has upset Felipe. It seems that this transfer is impossible. We have not received any offers from a club other than Galatasaray in Turkey. We will start looking for a new club."
Melo made 36 Super Lig appearances as Galatasaray was crowned champion, scoring 12 goals in the process.
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