Toy Story' s Woody the cowboy is riding back onto the big screen, but he' s about to discover there' s a new sheriff in town.

Disney is making good on its threats to go ahead with Toy Story 3, minus former collaborator Pixar Animation, which created the first two Toy Story films.

The studios decided to go their separate ways in January after failing to come to an agreement over extending Pixar' s distribution contract with the Mouse House.

When Pixar walked away from Disney, it meant leaving behind the rights to the Toy Story characters and other well-loved animated characters, such as Nemo of Finding Nemo fame.

Though Disney had expressed its intent to make the third installment of the Toy Story franchise without Pixar, the studio had so far held off on the project, partly out of deference to Pixar heavies Steve Jobs and John Lasseter, who did not want to lose the characters they created.

However, Disney is now in the process of setting up its own digital animation studio and seems set to produce the third Toy Story under its Walt Disney Feature Animation shingle.

The fact that Disney is going ahead with the project seems to lessen the chance of contract talks resuming between the Mouse House and Pixar.

Meanwhile, Tom Hanks, who voiced Woody in the first two films, recently expressed reservations about coming back for a third film if Pixar wasn' t involved.

" I don' t know," Hanks told reporters when asked if he would participate.

" Quite frankly, the creative team that put together the original Toy Story was very specific and organic to the success of the process. Not that there aren' t other talented people that would be involved [if another sequel was made]. That would be a bridge to cross when I come to it."

It looks like the time for bridge-crossing might be at hand.

Hanks' costar, Tim Allen, who voiced Buzz Lightyear, said he would be game to do Toy Story 3--as long as a team as talented as Pixar helmed the project.

" f they can get the magic that Pixar had, then I don' t think anybody' s going to complain about it," Allen said in a recent interview.

However, Allen wasn' t ruling out the idea that Disney and Pixar would reconcile.

" I wouldn' t throw out the reunification of those companies though," Allen said. " From where I sit, it' s a really good marriage that had a rocky period. I don' t think there' s anybody that' s better suited for each other."

Not that Pixar is hard up for a distributor. The studio' s latest release, The Incredibles, has met with, well, incredible success at the box office, smacking high-priced competitor The Polar Express to the curb.

Pixar' s contract with Disney formally expires next year upon the release of Lasseter' s film, The Cars, but the studio can afford to play hard to get.

" We are not going to make a decision until the last possible moment," Jobs told the New York Times last week.