And it seems Rosicky will stay, at least until the end of the year. This is according to Skysports:
Borussia Dortmund have pulled out of a deal to sell Tomas Rosicky to Atletico Madrid.
The Czech Republic ace appeared primed to move to La Liga during January's transfer window, although Arsenal have been watching the situation.
Dortmund had been demanding €13 million (£9 million) before they would consent to Rosicky's New Year exit.
But Atletico only offered €9.5 million (£6.5 million) and Dortmund have now broken off negotiations with their Spanish counterparts.
"It has come out as I expected," Dortmund business manager Hans-Joachim Watzke told Die Welt.
"Atletico general manager Miguel Angel Gil has not contacted us again, so that is why it is sure Tomas will stay in Dortmund."
The Bundesliga giants' decision has left Rosicky deflated as he is now likely to stay with Dortmund for the rest of the season.
Rosicky said: "What can I do when two clubs are not able to reach an agreement? I have a contract here."
The collapse of talks could now open the way for Arsenal to make a bid, although Rosicky's agent Pavel Paska accepts it is a complex situation.
Paska said: "The talks are very complicated, I will not comment on Dortmund's statement."