The glamour model and the Argentine hunk called time on their romance after seven months of dating, just days after he hinted they would marry.
The split is said to be down to the language barrier between them, as Katie speaks no Spanish and Leandro has only a basic grasp of English.
After a heartfelt discussion through a translator, they both decided it would be best if the male model moves back to Argentina.
A source told the Daily Mirror newspaper: "It`s over. The truth is Leandro felt isolated being in the UK without any of his friends or family.
"He decided it would be a good idea to return to Argentina and see his family, and try to get work. She agreed it was probably for the best."
Leandro appeared to get homesick after a recent visit from his family.
He went from the UK to New York with them, then extended his trip to see his brother in Miami.
It is from there he is believed to have made the phone call to Katie in which they decided to split. He then flew back to Argentina on 01.10.11.
A friend of Katie`s said: "Leandro decided it was time to take a break. And Katie didn`t disagree. He used a translator to tell Katie how he felt on the phone and said he thought it best he return home.
"Katie knew in her heart that it was coming. She`s being very adult about the split and says she didn`t see it as a long-term relationship that would lead to marriage and kids. But she will miss him. The language barrier was ultimately the problem for them."
Katie and Leandro met in February at Elton John`s Oscars party, shortly after she had splitfrom her second husband, cage fighter Alex Reid.
While Leandro had taken English lessons his progress was said to be slow, and they had both admitted to relying on web translation services to decipher text messages to each other.