His challenger, Home Affairs Minister Peter Dutton, resigned from Cabinet after the vote but the amount of support he gained a day after downplaying the possibility of a challenge surprised many commentators.
Australia's election is set to be held in the middle of next year.
The prime minister entered the party room with his deputy Julie Bishop amid speculation about his leadership.
John Hewson, a former leader of the Liberal party who is now with the Australian National University's school of public policy, said Turnbull was wounded and another challenge was likely within weeks.
"He's always got that in his back pocket".
Nearly half (49.5%) said Dutton as leader would make them less likely to vote for the Coalition.
A spokesman for Turnbull declined to comment on the prospect of an early election.
"The decline. may reflect the impact of the messy political debate locally and the associated slump in support for the current Turnbull government", said ANZ Head of Australian Economics David Plank.
Treasurer Scott Morrison insisted the leadership was "not an issue" and said Mr Dutton had told him in Question Time that his position had not changed and he was "fully supporting" Mr Turnbull.
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Others said that the prospect of fewer financial reports could exacerbate price swings around earnings or fuel insider trading. The president has run privately-held companies that didn't have to report results at all during most of his time in business.
Nearly two-thirds (64.7%) of One Nation voters said they would be more likely to vote for the Coalition of Dutton was leader.
But former Prime Minister Tony Abbott, who was replaced by Turnbull in a ballot of government lawmakers in 2015, was not convinced that Turnbull had given up on reducing Australia's greenhouse gas emissions by 26% below 2005 levels through legislation.
Malcolm Turnbull may have claimed victory in Peter Dutton's leadership challenge, but could face another contest within weeks, with nearly half of his MPs wanting him gone.
Mr Turnbull's U-turn alters a key plank of his signature energy policy, and follows a revolt by conservative MPs within his government.
With 35 votes to Malcolm Turnbull's 48, Dutton only needed another 7 MPs to support him in order to oust the prime minister.
Before the ballot, Environment Minister Josh Frydenberg had warned government colleagues that they would lose popularity if they dumped Turnbull.
Had just seven votes gone the other way, he would have lost office, and so the talk in Canberra has been when, not if, a second challenge would come. "My job is to make sure I can prosecute the sort of messages I spoke about and that is the only thing I am focussed on", he said.
By Tuesday evening, five ministers who voted for Dutton had submitted their resignations, according to the Australian Broadcasting Corp.
Senator Fierravanti-Wells, in her letter of resignation, criticised the Liberal Party for moving too far to the left.
"Our conservative base strongly feel that their voice has been eroded", she wrote to Mr Turnbull.