Japan's ruling Democratic Party is in danger of missing Prime Minister Naoto Kan's target in Sunday's upper house election, the Sankei newspaper said, an outcome that could put Kan's job at risk and complicate policymaking.

The Sankei also said on Tuesday that the Democratic Party of Japan (DPJ) and its tiny ally are unlikely to win the 56 seats needed to control the upper chamber, meaning the Democrats might need to seek new allies to implement policies smoothly.

The DPJ, which took power last year, will almost certainly run the government regardless of the July 11 result because it controls the powerful lower house. But it needs a majority in the upper chamber to enact laws and implement policies smoothly.

Kan, who took over from his predecessor in June, has put fiscal reform at the centre of the election campaign, including possibly doubling the 5 percent sales tax to curb the country's huge public debt nearing twice the size of the GDP.

A July 2-4 survey by the Sankei showed that the DPJ may win between 48 and 55 of the 121 seats up for grabs in the 242-member upper house, in line with other media forecasts saying it will fall short of the 60 it needs for an outright majority.

About 20 percent of voters are still undecided and the result could shift in the final days before the vote, the Sankei said.

The 63-year-old Kan has set a target of winning at least 54 seats, the number of seats that his party has up for re-election, but the Sankei said it is unclear if the DPJ can hit this target.

A weak showing would undercut Kan's ability to get backing from other parties to implement policies and could leave him vulnerable to a challenge from within his own party before his term as DPJ head ends in September.

Support for the DPJ rebounded after Kan, a former grassroots activist and a fierce debater, took over from his unpopular predecessor in June but has receded since he floated a possible sales tax hike.

In the Sankei survey, 43.6 percent said they support Kan's government, down 10.7 points from a previous poll in June, while 40.7 percent said they do not support the government.

The DPJ kept its lead in voter preference but the gap with its main rival narrowed. Asked which party they plan to vote for, 32.8 percent said the DPJ, down 9.6 points from the last survey, while 19.6 percent said the LDP, up 2.1 points.