Supporters of Victorian MP Moira Deeming have crashed a Liberal Party conference as tensions flare between members over the decision to expel her.

A small group clutching masks of Ms Deeming’s face and a sign labelling Liberal Leader John Pesutto a “bully” showed their support for the controversial MP at the party’s state council in Bendigo on Saturday.

Mr Pesutto was booed and some Liberal members staged a walk-out as he kicked off the two-day event, with speculation rife a leadership challenge was looming.

The members who walked out called for Mr Pesutto to be replaced as leader, The Age newspaper reported.

Mr Pesutto was expected to discuss policy and the future of the party, which remains fractured after Ms Deeming was booted from the parliamentary team last week for bringing discredit.

She was condemned for attending an anti-transgender rights rally where neo-Nazis were present, but maintains she has no ties to them.

Liberal MPs voted 19 to 11 to expel her amid legal threats from Ms Deeming after Mr Pesutto refused to publicly declare she is not a Nazi sympathiser.

After attending the rally in March, Ms Deeming was suspended for nine months and an expulsion motion was brought to the party room last week after the MP served Mr Pesutto with a defamation concerns notice.

She now remains on the crossbench as an independent.

The fallout has drawn criticism from federal Liberals, with Opposition Leader Peter Dutton saying earlier this month he was considering an intervention.

He said the controversy was damaging to the Liberal brand.

“The whole mess needs to be sorted out sooner rather than later,” Mr Dutton previously told ABC Radio. “The Liberal party should have been more competitive at the last state election. They weren’t and they need to be a credible alternative government.”

-AAP