TOKYO - Japan's embattled prime minister suffered a fresh blow Sunday as his ruling party was badly beaten by the opposition in a crucial Tokyo vote that is seen as a bellwether for a coming national election.

Prime Minister Taro Aso's Liberal Democratic Party and its coalition partner, the New Komeito Party, failed to keep a majority in the 127-seat Tokyo Metropolitan Assembly, according to early exit polls by public broadcaster NHK and the Kyodo News agency.

The Tokyo vote was closely watched as sign of how Aso's ruling party would fare against the main opposition Democratic Party of Japan in a general election, which must take place by October at the latest.

"Voters are fed up with the Liberal Democratic Party. Its economic and social welfare policies are all deadlocked. Voters are hoping that the Democratic Party of Japan can bring change to Japanese politics," said Takayoshi Matsuo, emeritus professor of political science at Kyoto University.

In the run-up to the Tokyo poll, Aso's party has already lost four straight regional elections since April to the opposition party.

The ruling party held 48 seats in the Tokyo assembly before the election, but NHK's exit polls indicated the party only won 38 seats as of late Sunday. The biggest opposition party snatched 54 seats so far, sharply up from 34. Official results are due by early Monday.

Since taking office in September last year, Aso has struggled to shore up sagging public support, which remains at 20 per cent. The 68-year-old premier has been diminished by a string of political gaffes and weak leadership.

The public was also frustrated with Aso's handling of Japan's economy, which is mired in the worst recession since World War II.

He has become so unpopular that some lawmakers within his own party are now calling for his removal before the upcoming election for the powerful lower house of parliament.

While Aso rejected any link between the outcome of Sunday's vote and the national election, the crushing defeat in the Tokyo polls could intensify moves to oust him.

Newspaper opinion polls have already suggested the opposition party is well-placed to make major gains or even rise to power in the national election, with its leader Yukio Hatoyama likely to replace Aso.,

That would mean the end of rule by the Liberal Democratic Party, which has governed Japan for all of the past 50 years except a brief period in 1993.

However, that would still require a sea change in voter support. The Liberal Democrats currently have 303 seats in the 480-seat lower house, and its partner Komeito has 31. The Democratic Party has just 112.

Hatoyama said Friday it was time for a new era in Japanese politics and that the country should be inspired by President Barack Obama's win in last year's elections in the United States, Japan's most important ally.

The opposition party has promised change in what it calls Japan's bureaucrat-led politics, improve welfare measures and lower the cost of education.

A nationwide survey by the Yomiuri newspaper, Japan's top-selling daily, showed Friday that 41 per cent of respondents said they would vote for the opposition party in the national election, compared to just 24 per cent for Aso's party.

Nearly 46 per cent of respondents said 62-year-old Hatoyama is fit for the prime minister, compared with 21 per centfavouring Aso. The Yomiuri survey of random voting-age people was conducted July 7-9. It received 1,087 responses.

The paper did not provide a margin of error, but based on the number of respondents the margin of error was plus or minus 4 percentage points.