The Trendbarometer survey by broadcaster RTL found 85% of respondents are dissatisfied with Merz's work, with only 14% pleased, the DPA reported.
Vice Chancellor Lars Klingbeil, the co-leader of the centre-left Social Democrats (SPD), was only slightly better off, with 18% praising his performance and 74% displeased.
More than four in five (82%) German citizens are dissatisfied with the work of Merz's government, which took office in May 2025.
The poor ratings are likely to boost the far-right Alternative for Germany (AfD), which is hoping for record showings in three state elections in September.
Notably for Merz, even the majority of the coalition parties' supporters are disappointed with the government's performance.
In the case of Merz's conservatives, 54% are dissatisfied, rising to 72% for the SPD.
The conservative-led coalition has been in a slump in the polls for some time as it seeks to enact its reform agenda to boost the struggling economy.
On Friday, the last day before the summer recess, lawmakers passed a cost-cutting health care law.
The coalition has also agreed on a reform package including tax relief for low and middle incomes from 2027, as well as employment measures and steps to cut red tape.