The Federal Health Minister has come out swinging against the NT Government's handling of the hospital system, as elective surgeries were cancelled overnight and medical services head towards a "code yellow".

Key points: Federal Health Minister Greg Hunt has called the NT Government a "disgrace"

Federal Health Minister Greg Hunt has called the NT Government a "disgrace" Royal Darwin Hospital is at capacity and heading towards a "code yellow"

Royal Darwin Hospital is at capacity and heading towards a "code yellow" Acutely ill people are still advised to go to the hospital, while others are being asked to go to the GP

Greg Hunt did not hold back with his criticisms of the NT Labor Government, labelling it a "disgrace" and saying it was "without doubt the most incompetent administration in Australia".

"The decision to cancel Royal Darwin Hospital's elective surgeries clearly demonstrates the Northern Territory Government's inability to govern," he said.

He also called on Chief Minister Michael Gunner and the entire NT Government to resign.

Mr Hunt said that the Federal Liberal government had increased its funding of Territory hospitals by 94 per cent. He said, by contrast, the NT Government funding had only increased by 42 per cent.

In response, Mr Gunner took issue with what he said was a lack of matched funding from the Federal Government.

"Territorians deserve the same quality of healthcare as other Australians and 50-50 funding is a reasonable request of the Federal Government," he said.

"Rather than issuing childish responses they should be matching our funding and stop treating Territorians like second-class citizens."

It is the third time in a year all elective surgeries have been cancelled. ( Supplied: Jack Bullen )

NT Health Minister Natasha Fyles spoke to ABC Radio Darwin and said she had been working with Mr Hunt to highlight the unique needs of the Territory.

"It costs us around $900 million to run our hospitals each year," she said.

"And the Federal Government puts in less than 30 per cent of that, at around $280 million."

Ms Fyles said the decision to defer electives surgeries was the safest choice for Territorians.

"Our emergency department is one of the busiest in the country," she said.

"This is a situation that does happen time to time. It does happen a few times every year. Where we have a capacity point that we have to defer our elective surgeries, and this is done from the point of clinical safety."

Royal Darwin Hospital's medical services director Alison Maclean also spoke to ABC Radio Darwin and said the facility was on the brink of an internal emergency because it was overloaded with patients.

"We are certainly very full. Every available bed is being used and we're cutting back on anything that doesn't need to happen so we can take patients in that need immediate acute care," she said.

Dr Maclean said that although a code yellow had not been called yet they were 'teetering on the brink' of the measure.

"We've done everything we can in our priority plan to address patient flow and still people are coming," she said.

If a 'code yellow' was called, the Health Department would be required to act.

"We're just bursting at the moment but we are coping, where as a code yellow is an internal emergency and it acknowledges that everything we are doing is still not easing the burden," Dr Maclean said.

"But at the same time, if someone needs acute care the hospital is still the best place. The last thing I would want to do is have anybody who is acutely unwell in community thinking 'oh well I shouldn't go to hospital'.

"But it is those who could go to their GP or their community health centre or nurses, we strongly encourage those people to do that."

It is the third time the Top End Health Service has cancelled all elective surgeries in the past 12 months.

Dr Maclean said it had been difficult to pinpoint the cause of the issue this time.

"We have had a lot of people with infections that people would usually develop during the wet season," she said.

"There is lots of minor trauma where patients need plastic surgery, that is putting on quite a burden.

"We're also starting with very cold days and so we're getting a lot of people with asthma and emphysema coming in with chest infections."

Top End Health Service medical director Charles Pain said it was common for the hospital to be operating at capacity.

"We manage that regularly and our staff are very resilient and they cope with that," he said.

"We are of course concerned that they are under pressure and demand. But they have managed that extremely well over a number of weeks."

Mr Pain said he expected the current situation to last no longer than a week.