Sussan Ley's leadership of the Liberal Party could be a casualty of the acrimonious breakdown of the coalition, even as Liberals lay the blame for the split at the feet of Nationals leader David Littleproud.
Mr Littleproud detonated the coalition for the second time in less than a year on Thursday, blaming Ms Ley for making the relationship "untenable".
Multiple Liberal sources who spoke to AAP on the condition of anonymity said the next few weeks remained unclear, but agreed Ms Ley's leadership was "terminal".
While accusing Mr Littleproud of blowing up the coalition, they acknowledged the parties could not get back together with both leaders at the helm.
"It's fluid and it's chaos," one Liberal backbencher told AAP.
But the backbencher endorsed Ms Ley's handling of the hate speech laws which precipitated the falling out, saying she had followed proper processes.
Mr Littleproud's leadership wasn't safe either, Liberal sources said.
The inter-party conflict came to a head on Wednesday, when all the Nationals in shadow cabinet tendered their resignation.
Mr Littleproud joined 10 others from his party in quitting Ms Ley's front bench after she accepted the resignations of three senators - Bridget McKenzie, Ross Cadell and Susan McDonald - earlier that day.
The trio tendered their resignations to Ms Ley for breaching cabinet solidarity, a principle that requires shadow ministers to all vote the same way, after voting against hate speech laws despite a joint party room meeting endorsing the legislation.
The Nationals decided to vote against the anti-hate laws, which were drafted in response to the Bondi terror attack, due to concerns they would threaten free speech.
By Thursday morning, Mr Littleproud had declared his party "cannot be part of a shadow ministry under Sussan Ley" marking the second split from the Liberals since the 2025 federal election.
"The Nationals' party room has determined that remaining in a coalition with the Liberal Party under the leadership of Sussan Ley has become untenable and cannot continue," he said in a statement.
Angus Taylor and Andrew Hastie are considered the two frontrunners to replace Ms Ley, but moderate Victorian MP Tim Wilson is another who might raise his hand for a leadership position.
Many within the former coalition were spooked by recent polling showing a rise in support for One Nation at their expense, insiders said.
In a statement, Ms Ley said the focus should be on Jewish Australians as the nation mourns the victims of the Bondi terrorist attack.
"This is a national day of mourning and my responsibility as leader of the opposition and leader of the Liberal Party is to Australians in mourning," she said.
Ms Ley said she spoke with Mr Littleproud ahead of his press conference, urging a 24-hour pause in respect of the day.
Asked if she could serve under Ms Ley, Senator McKenzie failed to endorse the Liberal leader.
"Who the Liberal Party chooses to lead them is a matter for the Liberal Party," she told reporters in Canberra.
One Nation MP Barnaby Joyce, a former Nationals leader who defected from the party, blasted Mr Littleproud for the "totally and utterly chaotic" handling of the situation.
He told reporters in Tamworth the split would make the Nationals "politically irrelevant".
Former Liberal prime minister John Howard said Ms Ley made the right decision to accept the resignations.
It's not the first time Ms Ley and Mr Littleproud have been at loggerheads.
A temporary split between the Liberals and Nationals in May 2025 was triggered by a number of demands being made by the regional party, including an ongoing commitment to nuclear power and a pledge to introduce forced divestiture powers for the supermarket sector.
They reunited after a week, but insiders believe the latest separation has the potential to last much longer.
