The former couple was spotted ringing in the new year together in Australia's Byron Bay and were pictured getting affectionate. According to a new report, they've been secretly affectionate for a while now.
A source within the pair's "inner circle" said Miley and Liam have been "back in each other's lives since the fall," TMZ claims. She even watched his dog recently while he was away.
The website indicated that Miley and Liam have been FaceTiming and texting each other constantly over the last several months.
"Miley's not using the bf label yet for Liam, but they're well beyond the friend zone," TMZ said after speaking to it source, adding that the duo "never really stopped loving each other, despite the break-up. She's been singing his praises to friends even more lately."
The couple famously dated and was engaged before splitting in 2014. Miley went onto to date Patrick Schwarzenegger for five months.
Reports that Miley and Liam were rekindling the flame first surfaced after they were seen kissing and cuddling at the Falls Music Festival at Byron Bay on Jan. 2 after they arrived with a group that included Liam's brothers Chris Hemsworth and Luke Hemsworth and their wives.
Photos have also emerged of Miley hanging out with Chris' wife Elsa and they two even went shopping together.
According to E! Online, Miley is now back in L.A. and is gushing about her trip.
"She had the time of her life being with him and his family," a source said. "Miley has never gotten over Liam and always hoped they would get back together. She definitely still loves him and wants to be with him."
Liam is reportedly equally interested in being back on with Miley.