Depending on who you ask, Toru Hashimoto is either a dangerous populist bent on returning Japan to its militarist past, or a charismatic radical leading a crusade to breathe life into the country's stagnant politics.

Still in his early 40s, and with no experience of national office, Hashimoto is not only the most talked-about politician in Japan, he is now being tipped as its future leader.

As mayor of Osaka, he has built a reputation for controversy, openness and a self-belief that has delivered stunning victories in local elections – qualities that could soon be tested on the national electorate.

As the prime minister, Yoshihiko Noda, battles to keep his Democratic party of Japan (DPJ) intact after a recent defection by its largest faction, Hashimoto is priming as many as 300 hand-picked candidates to run in what some analysts expect will be a snap general election this year.

"The next election is our last chance to change Japan," Hashimoto said recently. "If there are voices calling for Osaka's example to spread across Japan, [we] will respond firmly to those calls. Japan's old politics has to be swept away and a new politics built in its place."

The established parties have much to fear from Hashimoto, who became mayor of Japan's second biggest city in December after three years as governor of Osaka prefecture.

The prospects for an alliance with Ichiro Ozawa, the influential "shadow shogun" who left the DPJ to form a new party, have dimmed. But behind Ozawa is a queue of leaders from minor parties – as well as Tokyo's rightwing governor, Shintaro Ishihara – who are expected to consider a pact with Hashimoto's upstarts from Osaka.

With his policies yet to be tested on the national stage, much of Hashimoto's appeal lies in his style and unconventional background. He was born in Tokyo, and after his parents divorced was raised by his mother in a poor district of Osaka, home to the buraku – an "untouchable" underclass – since the 17th century. He never knew his father, a member of the yakuza, who committed suicide after becoming indebted to underworld associates while his son was still young.

Despite his origins, Hashimoto went on to study at Waseda, a prestigious private university in Tokyo, and became a familiar face on TV offering his views as a celebrity lawyer before entering politics.

His Osaka Ishin no Kai (Osaka Restoration Group) party has positioned itself as an alternative to politics as usual which, after the appointment of six prime ministers in as many years – during which there have been only two elections – resembles a power-sharing agreement between a political elite with an unshakeable sense of entitlement.

In style and substance, Hashimoto could not be more of a departure from that. Critics say his high-profile tussles with teachers' unions and his ban on public servants with tattoos are proof that he is an autocrat in the making.

But from his power base in Osaka, a port city faced with huge debts, failing schools and the highest proportion of welfare recipients in the country, the 43-year-old has won over despondent voters with attacks on inept national politicians and calls for a more presidential style of leadership.

His contempt for consensus building is matched by an enthusiasm for tearing up Japan's US-authored pacifist constitution, prompting one commentator to liken him to Hitler and nickname his movement "Hashism".

After months of speculation, Hashimoto has said 200-300 Ishin no Kai members will run in the next general election, selected from 2,000 students at the political finishing school he opened in Osaka in March. "Become warriors," he told them during a recent address. "Let's fight together. Let's change Japan."

As support slips away for the ruling and main opposition parties, Hashimoto and Ishin no Kai have a deep well of popular disillusion from which to draw. Nearly 80% of Japanese are dissatisfied with the direction the country is heading in, while 86% blame the government, according to a survey by the Pew Research Centre in Washington.

Hashimoto has said he will not run for national office while he still has work to do as mayor, notably the merging of Osaka city and prefecture into a huge, Tokyo-like metropolis. But experts on the city's politics believe he may simply be biding his time.

"He probably won't run this time," says Yuji Yoshitomi, an Osaka-based journalist who has written a book about Hashimoto. "But the problem for Ishin no Kai is that its popularity is entirely dependent on him."

Yoshitomi believes Hashimoto may wait and see what kind of political arrangement emerges from the next election – which must be held by August 2013 – before deciding on his future.

At the very least, a decent showing by Ishin no Kai – perhaps 60 out of 480 seats in the lower house – could be the catalyst for dramatic changes in Japan's political landscape.

"The DPJ is in trouble and the main opposition Liberal Democratic party [LDP] is in no fit state to fill the void, so the time is ripe for Ishin no Kai and other regional parties," Yoshitomi says. "The next election could see the birth of a new kind of Japanese politicis."

In the meantime, Hashimoto has launched attacks on the Tokyo political elite's dithering over everything from to nuclear power to tax increases. Instead, he envisages a "grand reset" he likens to Japan's transformation from a feudal to industrial economy 150 years ago. The postwar search for consensus, he says, has turned Japan into a democratic basketcase.

"Japan is a democracy but it can't make decisions," he said at a recent press conference. "We have endless discussions and take on board everyone's opinion, but nothing ever comes of it."

To achieve that change, he has proposed the abolition of the upper house of parliament, which can block legislation; direct elections for prime minister; and more powers for local government.

"Like the rise of extremist and nationalist parties of the right and left in Europe, Hashimoto derives his popularity from popular frustration with the established mainstream parties and the perceived failure of representative democracy," says Koichi Nakano, a political science professor at Sophia University in Tokyo. "He offers oversimplified, authoritarian pseudo-answers, which don't really solve problems, but serve as an outlet for popular frustration with the existing political system."

At times, Hashimoto sounds like Junichiro Koizumi, a former Japanese prime minister with hawkish views on defence who shares the mayor's enthusiasm for Thatcherite social policy.

He wants to make it easier to revise Japan's constitution, which bans the use of force to settle disputes, a move that critics say would open the door to a more aggressive military amid mounting territorial friction with China. On welfare, he apes the conservative right in the US and Britain. "Of course we have to support people who are absolutely unable to fend for themselves," he said. "But the rest should be encouraged to stand on their own two feet."

Nakano, however, sees a man willing to ditch his principles in his quest for Japan's highest office. "He is not a Margaret Thatcher or even a Junichiro Koizumi," says Nakano. "He seems less principled and more populist than they were. He approaches politics purely as a power struggle. Domination is what is at stake."