With just over 12 months until the Victorian election, Opposition Leader Brad Battin lost the top job to Kew MP Jess Wilson on Tuesday morning after a successful spill.
The 35-year-old is the state party's third leader in 11 months after John Pesutto was dumped and replaced by Mr Battin in late December.
The Victorian branch of the Liberals has never had a woman at the helm in its 81-year history.
Mr Battin was visited on Monday afternoon by a delegation of Liberal MPs who told him he had lost party room support, with others then calling him to deliver the same message.
Mr Battin did not nominate after losing the spill motion, paving the way for Ms Wilson to be elected unopposed.
"The vote didn't go my way," he told reporters.
Liberal MPs had quietly complained about Mr Battin's lack of focus on issues other than crime in the state.
The strategy rebounded last week when Labor unveiled a series of policies to crack down on crime, flat footing the opposition.
Retiring party stalwart Kim Wells said there had been "a lot of unfortunate mistakes" in the past few months.
Former tennis ace turned MP Sam Groth fended off David Southwick to remain the party's deputy leader.
Bev McArthur replaced David Davis as the party's upper house leader, with Evan Mulholland retaining his upper house deputy position to round out Ms Wilson's leadership team.
Ms Wilson described Mr Battin as a "tireless" worker for the party and said he would have a key role in her team.
Victorians have a "clear choice" come the election in November 2026, she said.
"A choice between a tired, out-of-touch Labor government or a new generation Liberal team," Ms Wilson said.
The leadership coup sets up head-to-head battle between Ms Wilson and Premier Jacinta Allan to run the state.
Ms Wilson is viewed as a more electorally potent challenger to Labor as a member of the party's moderate wing and a young mother with business savvy.
The former staffer to ex-federal treasurer Josh Frydenberg has previous experience as a Business Council of Australia executive and was immediately elevated to the key portfolio of education after entering parliament in 2022.
The coalition will need to gain at least 17 extra seats to form a majority government.
The Liberals and Nationals have been out of power in Victoria for all but four years since the turn of the century.
Support for the Victorian opposition had slipped in recent reputable polls despite the three-term Labor government grappling with soaring crime and state debt.
However, a Freshwater poll published by the Herald Sun on Tuesday morning suggested the coalition had its nose in front of Labor at 51 per cent to 49 per cent, with Mr Battin's favourability rating at plus 15.
Tensions within the party have simmered since a crushing defeat at the 2022 election, spilling into a defamation lawsuit launched by Liberal MP Moira Deeming against Mr Pesutto.
The moves among Victorian Liberals come after their federal counterparts abandoned the party's net-zero emissions policy, stoking speculation of a challenge against leader Sussan Ley.
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