West Australian One Nation Senator Rod Culleton has avoided having a conviction recorded against him after pleading guilty to larceny in a New South Wales court.

After several hours of discussions with the prosecution this morning, Senator Culleton pleaded guilty to the charge, which relates to the theft of keys from a tow truck driver in Guyra, in northern NSW in 2014.

Barrister Peter King told the court his client was acting in self-defence of his property when he took keys from the ignition of a tow truck and threw them into a ditch during an altercation with the driver.

Magistrate Michael Holmes told Culleton he acted in a "foolish manner" but did not record a conviction, meaning Senator Culleton's standing in the Senate will not be affected.

He was ordered to pay costs of more than $300 to the tow truck driver.

Senator Culleton earlier requested the trial be dealt with by a jury, but the judge said there was no case for such a trial and stood the matter down for discussions between the parties.

'I may have been foolish': Senator

Outside the court, Senator Culleton conceded his actions may have been foolish.

"Some days, dog shit does stick to your boot," he said.

"Holmes clearly said I was of very good character [and that] I may have been a bit foolish, and perhaps that may be the case, but I think this sends a clear message.

"It's been at huge expense, not only to myself but to a number of parties, over $7.50 of a key."

Under the constitution, MPs and Senators can be disqualified if they are convicted of an offence punishable by at least a year's jail.

Larceny carries a maximum penalty in New South Wales of five years' jail, but less if the stolen property is not worth $5,000.

"I was protecting my assets, they took me by surprise," he said.

"Look, he was a, what can I say, a hairy backed cranky tow truck driver that appeared on my property.

"And look, there was an altercation and perhaps one that went on a bit too long."

"I'd just driven my road train across the Nullarbor so perhaps were (sic) a bit tired and fatigued but it is what it was and it was vented in the court today."

But Senator Culleton's days in court are not over yet.

He is due to face trial in Western Australia over the alleged theft of a $27,000 hire car in the state's Wheatbelt last March.

The car was being used by two receivers at a farm at the centre of a foreclosure dispute.