Japan's ruling party on Friday picked former defence minister Shigeru Ishiba as leader, setting him up to become prime minister next week.

The party leadership win is a ticket to the top job because the Liberal Democratic Party's ruling coalition currently controls the parliament.

Considered a defense policy expert, Ishiba has proposed an Asian version of the NATO military alliance and a more equal Japan-US security alliance. Ishiba is a supporter of Taiwan's democracy. He calls for an establishment of a disaster management agency in one of the world's most disaster-prone countries.

Ishiba beat out Economic Security Minister Sanae Takaichi, a staunch conservative who was running to become the country's first female prime minister.

A record nine lawmakers, including two women, ran in a vote decided by LDP members of parliament and about 1 million dues-paying party members. That's only 1 per cent of the country's eligible voters.

Outgoing Prime Minister Fumio Kishida has been dogged by party corruption scandals, and the LDP wanted a fresh leader in hopes of regaining public trust before a likely general election.

Some experts believe that party turmoil could mean that Japan will return to an era similar to the early 2000s, which saw “revolving door” leadership changes and political instability.

A succession of short-lived governments hurts Japanese prime ministers' ability to set up long-term policy goals or develop trusted relations with other leaders.

On Tuesday, Kishida and his Cabinet ministers will resign. Ishiba, after being formally elected in a parliamentary vote, will then form a new Cabinet later in the day.

The main opposition — the liberal-leaning Constitutional Democratic Party of Japan — has struggled to build momentum, despite the LDP scandals. But experts say its newly elected leader, centrist former Prime Minister Yoshihiko Noda, is pushing a conservative shift for the party, could trigger a broader political regroupings.