ROCHESTER, N.Y. (AP) _ Eastman Kodak Co. has broken off talks on selling part of its Federal Government Markets unit, the company said.

Kodak had been talking about selling its Federal Systems Division to Ball Corp. Aerospace Systems Group, spokesman Paul Allen said.

''We were not able to reach an agreement on the terms and conditions of the sale,'' Allen said. ''We are not actively seeking buyers right now. We have decided to keep it within Kodak.''

Ball spokesman Alexander Bracken said the companies were unable to agree on a purchase price.

Federal Systems does secret research and supplies high-tech equipment to the federal government. If the sale had gone through, 500 to 700 Kodak employees could have gone to work for Ball Aerospace by the end of the year.

Kodak said in July it wanted to sell 10 ''nonstrategic'' businesses in its office equipment segment, including the Federal Systems unit.

Ball Aerospace is based in Boulder, Colo.