  We have studied local magnetic moment and electronic phase separation in
superconducting K$_{x}$Fe$_{2-y}$Se$_2$ by x-ray emission and absorption
spectroscopy. Detailed temperature dependent measurements at the Fe K-edge have
revealed coexisting electronic phases and their correlation with the transport
properties. By cooling down, the local magnetic moment of Fe shows a sharp drop
across the superconducting transition temperature (T$_c$) and the coexisting
phases exchange spectral weights with the low spin state gaining intensity at
the expense of the higher spin state. After annealing the sample across the
iron-vacancy order temperature, the system does not recover the initial state
and the spectral weight anomaly at T$_c$ as well as superconductivity
disappear. The results clearly underline that the coexistence of the low spin
and high spin phases and the transitions between them provide unusual magnetic
fluctuations and have a fundamental role in the superconducting mechanism of
electronically inhomogeneous K$_{x}$Fe$_{2-y}$Se$_2$ system.
