Labour's support has slumped to its worst rating for 15 years in the latest DigiPoll survey, putting critical pressure on leader David Cunliffe.
Its 26.5 per cent support is a slide of four points since June.
With just two months to the election, Labour could slip into the disastrous territory held by National in 2002, when it polled 20.93 per cent in the face of the highly popular Labour Government.
On this poll of decided voters National would be able to govern alone comfortably and gain another 10 MPs.
The poll results came as Labour Leader David Cunliffe received criticism for taking a skiing holiday just two months out from the election while his party lagged in the polls.
He spent part of last week in Queenstown with family skiing, which brought scathing criticism by fellow Labour MPs, the Sunday Star Times reported.
Quoting a party source, the paper said other Labour MPs were "incredulous" that he was holidaying while they were working hard up and down the country.
While the Prime Minister John Key has also taken a holiday in Hawaii, there was a "world of difference" between his 52 per cent support and Cunliffe's which lagged nearly 30 points behind, the source said.
"It sounds a little treasonous, but the guy doesn't want it badly enough. If he did, he would be working. I think it is disgraceful behaviour, and not the sort of behaviour becoming of a guy who wants to be prime minister."
He has since hit back at the criticism, saying he works as hard as anyone in politics.
His media director Simon Cunliffe said the Labour party leader worked 16-18 hour days, non-stop "pretty much 7 days a week", the Sunday Star Times reported.
His three-day break was a well needed rest prior to a gruelling election campaign, he said.
National has jumped 4.5 points to 54.9 per cent. A Stuff/Ipsos poll earlier this week also put support for National at 54.8 per cent.
Prime Minister John Key is more popular than he has ever been, scoring preferred prime minister on 73.3 per cent, compared with Cunliffe on 10.5 per cent and New Zealand First's Winston Peters on 5.5 per cent.
The second-most-preferred PM out of Labour MPs is David Shearer, with 2.2 per cent, followed by Jacinda Ardern on 1.4 per cent.
Two weeks ago a Labour conference focused on populist education policies, such as laptops for older students and smaller class sizes. But a controversial apology Cunliffe made at a domestic violence symposium may have resonated more than the education policies.
"I'm sorry for being a man, because family and sexual violence is overwhelmingly perpetrated by men," he said.
Labour's total support is down from 30.5 per cent in June, but it is disproportionately down among male voters, with only 23.9 per cent of men backing Labour, compared with 29.1 per cent of women.
Political commentator Chris Trotter said the poll indicated Labour was "more or less bereft of hope".
"Labour is in an extremely parlous position, and the situation is deteriorating."
Contrary to other polls, the DigiPoll had the Green Party losing popularity, which was also bad news for Labour and the left's prospects.
Labour leader David Cunliffe acknowledged his party had a lot of work to do. "But we think the election is going to be very close."
He said a number of recently-announced Labour policies were yet to be reflected in the polls and would take time to sink in.
He did not put too much weight on his drop in the preferred prime minister stakes. "My personal rankings have gone up in an number of other polls," he said.
Bill English, Acting Prime Minister while John Key is overseas, was careful not to sound too optimistic.
"It's still two months until the election and history shows every MMP election is close," he said.
The poll shows a lift for Internet-Mana to 2.2 per cent. Assuming Mana leader Hone Harawira keeps his Te Tai Tokerau seat, it would bring in Laila Harre and Annette Sykes.
New Zealand First falls just short of the 5 per cent threshold to get MPs into Parliament without an electorate seat, on 4.6 per cent, and would not make it back at all.
The poll of 750 decided voters was taken between July 10 and July 17. Undecided voters were 11.5 per cent. The poll has a margin of error of plus or minus 3.6 per cent.
National 54.9 (up 4.5 points since June)
Labour 26.5 (down 4)
Greens 9.9 (down 0.8)
NZ First 4.6 (up 1)
Internet Mana 2.2 (up 0.8)
Conservatives 1.2 (down 0.3)
Maori Party 0.5 (down 0.3)
Act 0 (down 0.7)
United Future 0 (down 0.1)
Legalise Cannabis 0.1 (up 0.1)
Seats in the House*
National 69 (59 elected 2011)
Labour 34 (no change)
Greens 13 (14
NZ First 0 (8)
Internet Mana 3 (1)
Maori Party 1 (3)
Act 1 (1)
United Future (1)
*Assumes that minor parties in Parliament keep an electorate seat.
Preferred Prime Minister
John Key 73.3 (up 7.4)
David Cunliffe (down 2.2)
Winston Peters (down 0.7)
David Shearer 2.2 (up 0.8)
Russel Norman 2 (down 0.5)
Jacinda Ardern 1.4 (up 1.4)
- Additional reporting: Matthew Theunissen, Brendan Manning