The far-right's defeat in a key regional election in Italy staves off for now a political crisis for the coalition government, but risks remain with a weakening Five Star Movement, analysts said Monday.

The failure of the far-right League to win over voters in the wealthy region of Emilia Romagna in Sunday's vote dashed leader Matteo Salvini's hopes of triggering a collapse of the current government.

But a floundering anti-establishment Five Star Movement (M5S), which shares power with the centre-left Democratic Party (PD), is creating more headaches for Prime Minister Giuseppe Conte.

Conte himself insisted that his government was "not unstable" and that the political significance of the vote was entirely "regional".

"We must work to counter the right," the premier said, speaking of the strengthening of a "progressive, reformist, alternative" front.

But observers said a win by Salvini would have caused Conte serious problems.

"Had Salvini won, the government crisis would have been inevitable," political scientist Emiliana De Blasio of the Luiss School of Government in Rome told AFP. "Now everything depends on the Five Stars."

The PD's Stefano Bonaccini won just over 51 percent of the vote in the centre-north region against just under 44 percent for League candidate Lucia Borgonzoni.

However, the M5S candidate received a paltry 3.5 percent, while the party's candidate in the southern region of Calabria fared only slightly better, with 7.3 percent. The party had chosen not to join forces with the PD behind a single candidate.

Corriere Della Sera editorialist Massimo Franco wrote that M5S "was crumbling everywhere, casting a shadow on the government of Giuseppe Conte".

The most striking element of the vote was not Salvini's defeat, but rather the "annihilation" of the M5S, Franco wrote, saying the party's power was beyond marginal, now "residual".

Matteo Salvini's League Party lost the vote in the wealthy region of Emilia Romagna
Matteo Salvini's League Party lost the vote in the wealthy region of Emilia Romagna AFP / Miguel MEDINA

The M5S has been haemorrhaging lawmakers amid party infighting, and leader Luigi Di Maio stepped down from his post on Wednesday in a bid to stave off a crisis.

It marks a dramatic change in fortune for the party, founded a decade ago by standup comedian Beppo Grillo, which six years ago won a majority of votes in Italy's lower chamber of deputies.

On Monday, acting party head Vito Crimi acknowledged M5S's "lower than expected" results.

"However, this does not lead us to give up: if anything, the opposite is true. We have already started the work of organisation that will allow us a greater coordination and will allow us to be more present on the ground," Crimi wrote in the party's blog.

The M5S remains the largest individual party in parliament, but alliances with first the League, and then the PD have confused its message among voters and analysts say the party risks fracture.

Now, the beleaguered party faces a choice, said De Blasio.

"They could pull the plug on the government and return to the opposition to rebuild themselves," she said.

Or they could move closer to the centre left, with its recent electoral coup.

"The message from the polls is that they need to have clearer policies," De Blasio said.