  We present a re-analysis of the ROSAT PSPC data within the central 100 kpc of
M87 to search for intrinsic oxygen absorption similar to that recently measured
in several galaxies and groups. Using a spatial-spectral deprojection analysis
we find the strongest evidence to date for intrinsic oxygen absorption in the
hot gas of a galaxy, group, or cluster. Single-phase plasma models modified by
intervening Galactic absorption cannot fit the 0.2-2.2 keV PSPC data as they
under-predict the 0.2-0.4 keV region and over-predict the 0.5-0.8 keV region
where the emission and absorption residuals are obvious upon visual inspection
of the spectral fits. Since the excess emission between 0.2-0.4 keV rules out
intrinsic absorption from cold gas or dust, the most reasonable model for the
excess emission and absorption features is warm, collisionally ionized gas with
a temperature of ~10^6 K. Simple multiphase models (cooling flow, two phases)
modified by both intervening Galactic absorption and by a single oxygen edge
provide good fits and yield temperatures and Fe abundances of the hot gas that
agree with previous determinations by ASCA and SAX. The multiphase models of
M87 inferred from the PSPC can account for the excess EUV emission observed
with EUVE and the excess X-ray absorption inferred from EINSTEIN and ASCA data
above 0.5 keV. Although the total mass of the warm gas implied by the oxygen
absorption is consistent with the matter deposited by a cooling flow, the
suppression of the mass deposition rate and the distortion of the X-ray
isophotes in the region where the radio emission is most pronounced suggest
some feedback effect from the AGN on the cooling gas. (Abridged)
