Joe Torre is done as Yankees manager after he rejected their one-year offer to remain with the club, ending his legendary 12-year reign in the Bronx.

George Steinbrenner and other Yankees executives, disappointed that the team failed to win the World Series for seven straight seasons after winning four titles in Torre's first five years, offered Torre a guaranteed one-year, $5 million deal that included an incentive-based option year if the Yankees reached the World Series in 2008. But Torre declined to take the deal in an afternoon meeting with club higherups in Tampa on Thursday, and the team quickly announced that the sides failed to reach an agreement and would seek to replace Torre.

Torre, accompanied from New York by general manager Brian Cashman and club COO Lonn Trost, two of his biggest supporters, flew to Tampa to discuss the deal with the rest of the club officials, and it appeared that they may be closing in on an agreement. However, Torre threw them a curveball by rejecting the proposal.

While several club executives weren't overly enthused about the possibility of bringing the iconic Torre back, a few still felt there was a good chance he'd take the deal as offered, which represented a paycut from his $7.5 million 2007 salary but was still $1.5 million more than the next highest-paid manager, Lou Piniella, not even including the incentives package, which would have paid Torre an additional $1 million for winning each of three rounds in '08 for a maximum of $8 million.

"It is time for the Yankees to move forward," club president Randy Levine said. "We feel we needed to go to a performance-based mode. We thought it was very fair. It clearly was the top of the market, but we respect Joe's decision."

Scott Boras, the agent for Yankees star Alex Rodriguez, said players would have interpreted an acceptance by Torre as weakness. "It is difficult, near impossible, to accept a salary cut," Boras told the Associated Press. "Successful people can afford their principles. They understand if they accept the position, there is a great risk the message to all under him is dissatisfaction. "

It was a trying last couple weeks for Torre ever since Steinbrenner told the Bergen Record that Torre would "probably" not be brought back if the Yankees didn't beat Cleveland in the Division Series. Team executives met for two days in Tampa and made what they considered to be a reasonable offer considering their lack of playoff success in recent years.

There was a public outpouring of support for Torre after the Yankees were eliminated, putting the club in a difficult spot. And they known they may still take a few public hits for not offering him more money or years, but the reality is that most club executives started to have doubts about Torre in the last year or two. The team with the $200 million payroll blew a three-games-to-nothing lead to the rival Red Sox in the 2004 ALCS, then followed that with three straight first-round exits.

"It's a difficult day," Yankees general manager Brian Cashman said.

They have interesting days ahead. Don Mattingly, a Steinbrenner favorite, has been seen as a favorite for the job, as has ex-Yankee Joe Girardi, who was Manager of the Year for Florida in 2006. Ex-Mets manager Bobby Valentine, Cardinals manager Tony La Russa, Yankees coaches Tony Pena and Larry Bowa, former Yankees minor-league manager Trey Hillman are seen as early candidates, though Cashman hinted that there could be some "surprises."

Torre hasn't spoken publicly since making his call, but perhaps he felt that a higher offer would show more respect after getting the team to the playoffs 12 straight seasons. It isn't known whether he has any other major-league managing opportunities, but it wouldn't be surprising if he did receive offers. Torre was also an excellent broadcaster in the 1980s.

Torre led the Yankees to 10 AL East title, but they have gone without a Series championship in the last seven and haven't even reached it since 2003.

With 2,067 regular-season wins, Torre is eighth on the career list and was third among active managers behind Tony La Russa of the St. Louis Cardinals (2,375) and Bobby Cox (2,255) of the Atlanta Braves. Torre's four World Series titles are likely to earn him a place in the Hall of Fame -- every manager with three or more has been inducted.

Torre's was the longest uninterrupted term for a Yankees manager since Casey Stengel held the job from 12 years from 1949-60. Stengel was pushed out, too, let go after his team lost a seven-game World Series to Pittsburgh.

Under Torre, the Yankees went 1,173-767. He trails only Joe McCarthy (1,460) for wins among Yankees managers.

"This has been a great 12 years. Whatever the hell happens from here on out, I'll look back on these 12 years with great, great pleasure," Torre said after his final game, his voice quavering as he tried to avoid choking up. "The 12 years just felt like they were 10 minutes long, to be honest with you."

He wouldn't address his future.

"If I have some options, I'll look at it because I'm certainly not ready to move somewhere and not do anything," the New Yorker said.

When Torre succeeded Buck Showalter, the Yankees had not won the World Series since 1978, the longest drought since the team's first title in 1923. It was the 20th change in manager following Steinbrenner's purchase of the franchise in 1973.

Torre never had much success as a manager before landing in New York, and many predicted he would be gone in no time. But he turned out to be a rock and a buffer to the blustery Steinbrenner. He was calm, stoic and brought an unprecedented period of stability to a team accustomed to constant turmoil.

The Brooklyn native was a former NL MVP and a nine-time All-Star. Before joining the Yankees, he had unsuccessful managing stints with the Braves, Cardinals and Mets -- the three clubs he played for. When the Yankees hired him, one New York paper dubbed him: "Clueless Joe."

But New York won the World Series in 1996, led by a group that included Bernie Williams, rookie Derek Jeter, setup man Mariano Rivera, Paul O'Neill and Tino Martinez. With catcher Jorge Posada added in, they won the Series from 1998-2000, the first team to win three straight since the Swingin' Oakland A's of 1972-74, and advanced to Game 7 of the Series in 2001, when they failed to hold a ninth-inning lead at Arizona.

Since then, despite baseball's largest payroll, there has been only frustration: a first-round loss to the Anaheim Angels in 2002, a World Series defeat to the Florida Marlins in 2003 and a painful exit the following year, when they allowed the Boston Red Sox to overcome a 3-0 deficit in the AL championship series.

They lost to the Angels in five games in the first round in 2005, were eliminated by the Detroit Tigers last year and were knocked out by Cleveland this year.

Communication between Torre and Steinbrenner deteriorated in 2005, and it wasn't clear that Torre would return for 2006 until after the pair met in Tampa. Steinbrenner meddled less with the team the past two seasons -- even during a 21-29 start this year -- giving almost unprecedented authority to Torre and Cashman.

Mattingly, who declined comment, became the Yankees' bench coach this year following three seasons as hitting coach. A six-time All-Star and a former AL MVP, he starred for the team from 1982-95 and is a fan favorite whose No. 23 was retired by the Yankees in 1997.

Girardi is a Torre protege who kept a young Florida team in contention until late in the 2006 season with a no-nonsense approach.

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