Palau's president Tommy Remengesau Junior has threatened to leave the Pacific Islands Forum if the secretary general's post does not go to Micronesia.
Effectively the chief executive of the premier regional body, the secretary general is appointed by the leaders of the Forum's member states.
Only one Micronesian had ever held the position, the first president of Kiribati, Sir Ieremia Tabai, who was appointed in 1992.
Since then the post has been held by candidates from Australia, Tuvalu, Samoa and twice by Papua New Guinea including current Secretary General Dame Meg Taylor who has been in the role for two consecutive terms.
Speaking at a special Micronesian leaders meeting in Koror, Remengesau, alluded to the honouring of a "gentleman's agreement" between Pacific Islands Forum leaders that the next secretary general would come from their sub region.
"This is an important consideration for Palau to continue to participate and be productive in the PIF agenda as long as our promises are met.
"We must therefore pursue every available option to ensure that these prior commitments are kept, now and in the future. If necessary, we must discontinue
our participation in Pacific Island Forum activities until this issue is resolved," he said.
The leaders of the five Micronesian countries of Palau, Kiribati, the Marshall Islands, Nauru and the Federated States of Micronesia, nominated Gerald Zackios, Marshall Islands' ambassador to the US, for the secretary general's post.
But four other countries also put their candidates forward including Fiji's Ratu Inoke Kubuabola, the Cook Islands' outgoing prime minister Henry Puna, Tongan economist Amelia Kinahoi Siamomua and the former head of the Pacific Community Jimmy Rodgers from Solomon Islands.