Labor MP David Feeney said he would resign after being unable to prove that he had renounced his UK citizenship.
Last year, nine politicians were ousted over concerns they held dual citizenship - although two were later returned through by-elections.
Dual nationals are not allowed to stand for parliament in Australia.
Mr Feeney said he thought he had renounced his British citizenship, but he could not find decade-old paperwork despite "extensive searches".
"I am unable to disprove that I am a dual citizen," Mr Feeney told reporters on Thursday.
He had found proof that he renounced Irish citizenship, he said.
The citizenship saga has rocked Australian politics since July and at times threatened Prime Minister Malcolm Turnbull's one-seat majority in the House of Representatives.
It had unseated two lower house government MPs, but both won by-elections in December.
Are more resignations likely?
Mr Turnbull moved to definitively end the saga last year by forcing all MPs and senators to publicly clarify their citizenship history.
As a result another Labor politician, Katy Gallagher, referred herself to the High Court of Australia for a ruling on her eligibility.
Labor has claimed at least eight other politicians from various parties may also need to have their status determined by the court.
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