Moderates in Silvio Berlusconi's centre-right movement pulled out of a leadership meeting on Friday, risking a split that could threaten the stability of Italian Prime Minister Enrico Letta's coalition.
The wrangling within Berlusconi's People of Freedom (PDL) party may further damage already weak coalition cohesion on policy, hobbling efforts to reform a sclerotic economy - the euro zone's third largest - stuck in a two-year-long recession.
The PDL has come close to breaking up over growing tension between hardliners pressing for a break with Letta's shaky bloc of left and right and a moderate group that backs the government formed in the wake of February's inconclusive election.
After an angry meeting between Berlusconi and party secretary Angelino Alfano, the so-called "doves" including the five PDL ministers in the government decided to boycott a meeting of the party leadership group, led by Berlusconi.
"My contribution to the unity of our political movement, which I will never block for reasons to do with my personal role, is not to take part, along with other colleagues in the presidium meeting," Alfano said in a statement.
The divisions emerged clearly this month when moderates led by Alfano defied orders and backed Letta in a confidence vote in parliament, humiliating Berlusconi and forcing him to abandon an attempt to bring down the government.
Whether a split in the centre-right would unravel the government was not clear but it appears likely to raise tension between the PDL and Letta's centre-left Democratic Party (PD), and further dim prospects of any sustained economic reform.
The problems have been exacerbated by Berlusconi's impending expulsion from parliament over a tax fraud conviction, which will have to be approved by a vote in the Senate and which could expose him to the risk of arrest in other criminal cases.
The PDL leadership was to meet on Friday to discuss changing the name of the party to Forza Italia, as Berlusconi's original movement was known when the billionaire media magnate, now 77, entered politics in 1994.
Members of the moderate faction regard such a change, which could see Alfano's position as party secretary abolished, as a way of reinforcing the influence of the conservative hardliners and had called for the meeting to be postponed.
"There can be a frank, honest and open debate, that's one thing," said Roberto Formigoni, a former governor of the affluent northern Lombardy region who broke with Berlusconi and supported the government in the Oct. 2 confidence vote.
"But if the PDL wants to take an extremist line which isn't part of our story, perhaps by changing into Forza Italia - trying to smash everything to save who knows what but actually sinking the country, we can't go along with that," he told SkyTG24 television.
The PDL infighting arose with parliament preparing to debate a 2014 budget law that has been widely criticised for failing to cut taxes enough and doing little to reduce wasteful spending.