UPDATE 2-Japan PM eyes early August poll, job at risk

(For more stories on Japanese politics, click [ID:nPOLJP]

* PM eyes general election for Aug. 8 - Kyodo report

* Japan ruling bloc suffers big defeat in Tokyo election

* PM's job at risk, ruling party chaos seen

* Poll portends big ruling bloc defeat in national vote

(Releads, adds ruling party lawmaker quote)

By Linda Sieg and Isabel Reynolds

TOKYO, July 13 (Reuters) - Japanese Prime Minster Taro Aso appears ready to call a general election for early August despite a big defeat in a weekend vote in Tokyo and fears from within his ruling party that an early poll would be political suicide.

Moves within the Liberal Democratic Party (LDP) to dump Aso were expected to grow after the ruling party and its junior partner lost their majority in a vote for the Tokyo assembly on Sunday. The opposition Democratic Party won the most seats.

A Democratic Party victory in the national parliament's lower house would end half a century of nearly unbroken rule by the business-friendly LDP and raise the chance of resolving political deadlocks as Japan tries to recover from its worst recession since World War Two.

Aso told senior ruling party lawmakers on Sunday he planned to dissolve the lower house as early as Tuesday and was set to unveil that plan on Monday, Kyodo news agency reported, adding the likely date for the election was Aug. 8.

But many in the ruling bloc are opposed after their defeat in the Tokyo poll, seen as a barometer for a national election due by October.

"When to call an election is up to the prime minister and a politician's fate is up to the politician," said Hidenao Nakagawa, a former LDP secretary-general.

"I have been saying from the beginning that he (Aso) should make an honourable decision and there is no change in that," he told reporters, repeating his call for Aso to step down.

LDP executive Nobuteru Ishihara, asked on Sunday if the party would fight the general election under Aso, dodged the question.

"That the LDP could not unify including on this point (Aso's leadership) is one reason for this harsh judgment," he said. "If we don't overcome this, we cannot regain the trust of the people."