updated 05/17/2011 AT 4:00 PM ET
•originally published 05/23/2011 AT 12:55 PM ET
The pair, who were spotted hugging on a yacht on the French Riviera during the festival last week, were seen again looking friendly in Portofino, Italy, on Sunday.
Lively, 23, and the newly single DiCaprio, 36 – both wearing hats and sunglasses – went sightseeing and “seemed happy in each other’s company,” according to an observer. They were “laughing and walking” together.
No word on whether the outing was just for fun or had a business element to it. Last November, the two stepped out for dinner at The Lion in New York City, where they were reportedly talking about a movie project.
Reps for both DiCaprio and Lively had no comment.