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Miley Cyrus 'Never Wanted to Split' from Liam Hemsworth, Says Source: 'They Are Back Together and Very Happy'

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Miley Cyrus and Liam Hemsworth have officially rekindled their romance. And wedding bells might be in their future.

Cyrus sparked the engagement rumors herself Monday when she posted a photo on Instagram flaunting what looks like the 3.5-carat Neil Lane diamond engagement ring she had previously accepted from her former fiancé prior to their split in 2013.

Miley is where she has wanted to be for the past two years. Back with Liam and very happy,” a source close to Cyrus tells PEOPLE. “Miley never wanted to split. Things just got so bad that they really needed the break.”

For more on Cyrus and Hemsworth’s relationship, pick up the latest issue of PEOPLE, on newsstands Friday.

Celine Dion on the cover of PEOPLE

The renewed relationship between the 23-year-old pop star and Hemsworth, 26, seemed especially improved after Cyrus’ affectionate visit with the Hunger Games star and his family while on vacation in Australia.

“Now reunited, Miley seems ecstatic,” continues the source. “She loves her life and is excited about the future. She always loved her engagement ring and was very proud of it.” But are they headed down the aisle?

There is no date, says the source. But they are back together and very happy.