Australia will have its fifth prime minister in eight years after the ruling Liberal Party on Monday voted out Tony Abbott in favour of longtime rival Malcolm Turnbull, following months of infighting and crumbling voter support.

Turnbull, a multi-millionaire former tech entrepreneur, won a secret party vote by 54 to 44, Liberal Party chief whip Scott Buchholz told reporters after the meeting in Canberra.

Australia is set to hold elections before the end of next year, and Turnbull, expected to be sworn in as prime minister on Tuesday, told reporters he had no intention of calling an early poll to cement his legitimacy.

"I'm very humbled by the great honour and responsibility that has been given to me today," an ebullient Turnbull told reporters during a late-night press conference.

"This will be a thoroughly liberal government. It will be a thoroughly liberal government committed to freedom, the individual and the market."

Foreign Minister Julie Bishop was re-elected deputy leader of the party which, with junior coalition partner the National Party, won a landslide election in 2013.

Abbott had earlier pledged to fight the challenge from Turnbull, but was ultimately unsuccessful in overcoming the "destabilisation" that he said had been taking place within the party for months.

He walked stony faced out of the party room following the vote and did not speak to reporters.

Abbott ousted Turnbull as leader of the Liberal Party in 2009, though Turnbull has consistently been seen as a preferred prime minister. However, Turnbull's support for a carbon trading scheme, gay marriage and an Australian republic have made him unpopular with his party's right wing.

The challenge came as Australia's $1.5 trillion economy struggles to cope with the end of a once-in-a-century mining boom and just days before a by-election in Western Australia state widely seen as a test of Abbott's leadership.

Abbott emerged badly weakened from a leadership challenge in February, which came about after weeks of infighting, and pledged a new spirit of conciliation.

But he and his government have since consistently lagged the centre-left opposition Labor Party in opinion polls, helping fuel speculation over how long his party would give him to turn things around. - Reuters