On a visit to Beijing in September, Murdoch's wife Wendi Deng met with Bokee -- one of China's first and best-known blogging sites which commands 25 percent of the market -- one source said.
MySpace co-founders Tom Anderson and Chris DeWolfe have also met Bokee and rival BlogCN several times, the sources said, though it remains unclear whether there will be a tie-up.
''I think (News Corp.) wants to do their own thing -- the talks were to exchange ideas about how to operate in China,'' one source said.
Since last year's $580 million purchase of MySpace.com, one of the Internet's fastest-growing properties, News Corp. Chairman and Chief Executive Murdoch has been talking up the Web, as he now believes Internet businesses will grow faster than cable networks and newspapers.
In September, Murdoch sent his wife Deng to Beijing as part of plans to expand into 11 markets globally.
News Corp. said on Wednesday it could launch a version of MySpace in China during this fiscal year if it found the right joint venture partner.
The possible timeline on MySpace's China ambitions comes on the heels of an announcement that News Corp. has struck a joint venture deal with Softbank Corp. to launch a version of MySpace in Japan.
Chinese blogging companies, facing an increasingly competitive market, are also hungry for foreign capital.
Bokee, whose name is Chinese for Web log, or ''blog'', has attracted 5 million yuan ($635,768) in seed funding as well as $10 million in venture capital from six U.S. and Chinese firms.
Another blog, Blogbus.com, received between $3 million and $5 million from Japanese venture capital firm JAIC and Japanese ad company Cyber Agent, in Blogbus's first round of external investment, according to local media reports this week.
News Corp.'s foray into China follows global giants Microsoft, Google and Yahoo Inc., who already offer blogging services there, in a crowded sector also populated by a bevy of homegrown players and social networking sites.
China is the world's second biggest Internet market by users, with more than 120 million netizens.
The number of bloggers in China is expected to hit 60 million by the end of this year and 10 million by 2007, according to an article from state news agency Xinhua this year citing a report by prestigious Tsinghua University, despite curbs on media and dissent.
The Chinese government, obsessed with maintaining Communist Party rule, routinely monitors online chat forums and bulletin boards for controversial political comment, censoring words such as ''freedom'' and ''democracy''.
In the past couple of years, several Internet sites that were forums for candid opinion have been closed.
REUTERS DKS PM1516