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ABC In crosshairs: Rebel MLAs Larisa Lee, Alison Anderson and Francis Xavier

Chief Minister Adam Giles has dumped one of three rebel Indigenous MLAs from the parliamentary wing of the Country Liberals.

The Member for Namatjira Alison Anderson will have to move to the cross benches.

It is also possible that a meeting of the Country Liberals executive may move to expel Ms Anderson from the party.

Mr Giles said talks between himself and the three rebel MPs had broken down because the Country Liberals were "being asked to govern with a gun to our heads".

The Country Liberals Government's three indigenous members, Alison Anderson, Larisa Lee and Francis Xavier, have been pressuring Mr Giles for several weeks and presented him with a list of demands.

Mr Giles said the list of demands had gone too far and he would not be held to ransom.

"It has got to a point when it is simply a joke," he said.

The ABC understands their list of demands included creating a new Aboriginal affairs department, making Alison Anderson the minister for Aboriginal affairs, and former chief executive of the Northern Land Council, Norman Fry, her chief of staff.

Larisa Lee wanted to be made minister for youth, sport and recreation, parks and wildlife, and women's affairs.

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NT Chief Minister Adam Giles dumps Al;ison Anderson, ringleader of three rebel backbenchers