Australia's Liberals could dump Malcolm Turnbull for Peter Dutton

Australia could face another leadership coup with rumours swirling Prime Minister Malcolm Turnbull could be ousted.

Australian media reports Mr Turnbull's position as leader of the Liberal Party is under threat, with backbenchers calling for Home Affairs Minister Peter Dutton to force a spill.

According to 9 News, Mr Dutton has told colleagues he is contemplating a challenge - while the Sydney Morning Herald reports he has been sounding out his colleagues.

Rumours started after a sharp drop in popularity for the Coalition Government and internal conflict over the controversial National Energy Guarantee policy.

The flagship energy policy would mean power companies face default energy prices, as well as being stung with tough penalties if they failed to bring costs down.

However Conservative MPs believe Mr Turnbull is too moderate and too focused on lowering carbon emissions.

"He's just not one of us," a senior Liberal told 9 News.

The infighting has damaged the Liberals' poll ratings. The latest Fairfax-Ipsos poll shows the Coalition's primary vote has dropped from 39 to 33 percent over the past month.

The Coalition is now behind Labor by 45 to 55 percent in two-party terms. This would wipe off 20 seats if a general election was held now.

While Liberal MPs are split on whether Mr Dutton has the numbers to roll Mr Turnbull, in public he has voiced his support for his leader.

"In relation to media stories today, just to make it very clear, the Prime Minister has my support and I support the policies of the Government," he said on Twitter on Saturday morning.

But it's been noted that Mr Dutton's response took 24 hours and avoided a pledge not to challenge the leader.

"He supports the Prime Minister 'till the moment he's challenging him," an MP told the Sydney Morning Herald.

 "I think Malcolm Turnbull is terminal and will be very surprised if he is still leader by the end of the year," one MP told 9 News.

However others are backing Mr Turnbull to retain control - especially due to fears the rise of Mr Dutton would lead to the return of Tony Abbott to Cabinet.

"Peter Dutton is one of the most unpopular people in government," a Turnbull supporter said.

"It would be electoral suicide to have him as leader."

Newshub.