A defiant Malcolm Turnbull is clinging on to the prime ministership but challengers are close to securing the 43 signatures needed to force a leadership spill.
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Mr Turnbull threw down his own challenge after Peter Dutton demanded another vote on Thursday morning, telling Liberals who want him gone to reveal themselves as he set a deadline of midday on Friday for the second leadership challenge of the week.
He demanded Mr Dutton get at least 43 MPs to sign a petition to force the spill - and promised to quit as prime minister if the ballot goes ahead.
But Mr Dutton's path to the top job won't be smooth, with treasurer Scott Morrison and foreign minister Julie Bishop also standing up as candidates later in the day to make it a three way contest.
By early evening, it appeared the petition numbers were building.
"I have just signed the petition, I have done that because this matter needs to be resolved as a matter of urgency," Liberal MP Karen Andrews told Sky News on Thursday.
"I understand that only one more signature is required."
The ABC reported that 40 MPs had signed the petition.
Liberal MP Tim Wilson said he declined to sign the letter.
"I have not been bullied or intimidated into signing the suicide note to call a leadership spill," he said on Twitter.
The decision on Thursday afternoon by deputy Liberal leader Ms Bishop - who has successfully bridged the moderate-conservative divide in the party - to canvass support could split off MPs who were considering backing Mr Dutton.
"Australians will be rightly appalled by what they're witnessing in their nation's parliament today and in the course of this week," Mr Turnbull told reporters.
"A minority in the party room, supported by others outside the parliament, have sought to bully, intimidate others into making this change of leadership that they're seeking."
The prime minister has lost 13 ministers, including loyalist Mathias Cormann, after they told him the numbers had moved behind Mr Dutton, who lost Tuesday's leadership vote 48-35.
"I can't ignore the fact that a majority of colleagues in the Liberal Party party room are of the view that there should be a change," Senator Cormann told reporters, adding it came with a "heavy heart".
Mr Turnbull expects the solicitor-general to provide MPs with advice on whether Mr Dutton is eligible to sit in parliament before Friday's meeting.
The former home affairs minister has his own legal advice that his interest in childcare centres - which receive funding from the federal government - does not breach section 44 of the constitution.
The section bans from parliament anyone with "any direct or indirect pecuniary interest with the public service of the Commonwealth".
"I cannot underline too much how important it is that anyone who seeks to be prime minister of Australia is eligible to be a member of parliament," Mr Turnbull said.
Mr Turnbull said the public would be "crying out for an election" once the dust settled, after a "form of madness" took over in the party room.
Polls, however, predict a Dutton government would be heavily defeated in an election.
A Morgan poll found Mr Dutton was well behind Labor leader Bill Shorten as preferred prime minister 59-36, but Mr Turnbull remained ahead of the opposition leader.
A ReachTel poll of more than 2400 voters found If Mr Dutton became prime minister 55 per cent of voters would be less likely to vote Liberal.
And a Galaxy poll showed Mr Dutton was behind Mr Turnbull, Ms Bishop and even former prime minister Tony Abbott as preferred prime minister.
Mr Dutton is also facing a Senate inquiry over his 2015 decision to give visas to two au pairs, with Labor referring allegations concerning the alleged inappropriate exercise of ministerial powers to a committee.
Australian Associated Press
