The Digital Advertising Alliance, a coalition of advertising trade groups, advised its members earlier this month to ignore Do Not Track requests from Internet Explorer users.
In Friday's announcement, Yahoo defended online tracking.
"Our users have come to expect a personalized Yahoo! experience tailor-made for their lives — whether they’re checking local weather, sports scores, stock quotes, daily news, or viewing ads on our site," the company said in a blog post. "We fundamentally believe that the online experience is better when it is personalized."
The company said that it respects users' privacy choices, but that because Do Not Track is now the default on Internet Explorer, the setting does not reflect the user's choice.
"Ultimately, we believe that DNT must map to user intent — not to the intent of one browser creator, plug-in writer, or third-party software service," the company said. "Therefore, although Yahoo! will continue to offer Ad Interest Manager and other tools, we will not recognize IE10’s default DNT signal on Yahoo! properties at this time."
A Microsoft spokesman pointed to a Friday morning speech by Brad Smith, the company's general counsel.
Smith argued that making Do Not Track the default gives users more control over their privacy.
“Just because the signal is turned on doesn't mean that a consumer wants no services that involve tracking," Smith said. "It means instead that consumers are empowered to make their own choices, including selecting services that involve tracking from advertisers and ad networks they trust.”
Reps. Ed Markey (D-Mass.) and Joe Barton (R-Texas), the co-chairs of the Bipartisan Privacy Caucus, issued a joint statement, slamming Yahoo and defending Microsoft's policy.
"If consumers want to be tracked online, they should have to opt-in, not the other way around," the lawmakers said. "Yahoo seems to be operating on the ‘do not honor code’ by ignoring this valuable tool that protects consumer privacy."
Advertisers, privacy groups and other companies are currently negotiating to implement an Internet-wide Do Not Track standard at the World Wide Web Consortium (W3C), an international standards-setting body.