The pro-independence Caledonian Union is this afternoon expected to resign from New Caledonia's collegial government, which will bring down the administration of Philippe Gomes formed after the 2009 election.
This comes amid a dispute over some town halls refusing to hoist both the French and the Kanak flag.
The move by the pro-independence parties has the tacit support of the anti-independence Rassemblement-UMP which is a rival party of Mr Gomes's Caledonia Together party.
Mr Gomes says the 1998 Noumea Accord provides for a new flag to be chosen to express the territory's identity.
He says if the Caledonian Union quits, there have to be fresh provincial elections to choose a new Congress.
Last year, the French tricolore and the Kanak flag were first raised jointly on public buildings when the French prime minister visited Noumea.