The latest Sensis Business Index report says the Northern Territory Government is losing the support of small business.
The report says small business approval of the Government has dropped six per cent from December to March.
Report author Christena Singh says those happy with the Government believe it is creating jobs and growth.
But businesses unhappy with the Government feel it is too bureaucratic, too centralised and does not understand small business.
"Too much bureaucracy is the number one reason that small business feels that State or Territory governments overall act against their businesses, and in the Territory that is also the top reason," Ms Singh said.
Chamber of Commerce chief executive Chris Young says those ill feelings have been growing in the Territory for some time.
"I think it goes without saying that the majority of government does not understand how small business operates, try as they might," he said.
"They come from a totally different mind-set and a totally different background, and they don't understand how small business works." The Sensis report also says the decision by Inpex to build a gas plant in Darwin is worrying small and medium businesses in the Territory.
It says overall confidence in the Territory is down to 17 per cent, which is a third of what is it was this time last year.
Ms Singh says a high Australian dollar and falling sales are the main reasons behind the dip.
She says while some businesses see great opportunity with Inpex, others are worried it will take away many workers.
"In the Territory, quite differently to the rest of Australia at the moment, it is still having difficulty finding staff for businesses," she said.
"Small business sees itself at quite a disadvantage in attracting staff." Mr Young says Inpex will be good for the Territory economy.
He says positive effects should start being felt in about five months.
"The Inpex project will have a positive flow-on once activities start up and it is still a little early for activity because we are still in the wet season," he said.