At the beginning of 2002, it seemed Team Xtreme had patched things up.
After the Brand Extension, however, Hardy was relegated to Heat while Jeff wrestled on the main show, Raw. On the October 3 edition of the show, Hardy took advantage of a run-in from Brock Lesnar to defeat The Undertaker.
On July 5, they won their first WWF Tag Team Championship by defeating the Acolytes, but lost it back to them a month later.
They soon dumped Hayes however, and joined the short lived stable The New Brood.
Lita, for the first time in over five years, turned heel as a result of the affair becoming public knowledge.
Fans began a petition on the internet, wanting WWE to resign Hardy, and amassed over fifteen thousand signatures.
Hardy continually wrestling with the WWF sporadically, including matches against Hunter Hearst Helmsley and "The Ringmaster" Steve Austin.On the August 12 episode of Raw, Hardy turned against Jeff during Jeff's match against Rob Van Dam, because Hardy was frustrated at not receiving a match against Van Dam for the number 1 contendership for the Intercontinental Championship. Having now dubbed himself Matt Hardy: Version 1, and with his MF'er (Mattitude Follower) Shannon Moore in his corner, 2003 began with Hardy frantically trying to lose weight to get under the 220 lb (100 kg).