Prime minister Jacinda Ardern has confirmed that a patient being tested for coronavirus has the illness. It is New Zealand's first confirmed case.
The patient - who is in their 60s - is in a stable and improving condition in hospital in Auckland, she said.
They are a citizen of New Zealand who had been to Iran and flown back to New Zealand via Bali, she said.
She said New Zealand's pandemic plan is now being fully put into place after the positive result.
"It has been through good care and good management that New Zealand has gone through such a long period of time without having a case arriving on our shores," Ardern added.
The Ministry of Health earlier confirmed that testing was underway for a suspected coronavirus case. Director-general of health Ashley Bloomfield revealed the news in a press conference on Friday afternoon.
The results of the test were formally reported at around 4.15pm on Friday.
But despite the confirmation, the chances of community outbreak remain low the Ministry of Health said.
The patient is being treated in Auckland City Hospital and is in isolation in a negative pressure room to prevent any spread of the disease.
Their immediate contacts are also in isolation as a precautionary measure. Public health officials have begun tracing the patient's other close contacts, including on the flight involved which originated in Tehran and came via Bali.
The person arrived in Auckland on 26 February and travelled home in a private car. Their family became concerned about their condition and called Healthline.
They were advised to seek medical attention and attended Auckland City Hospital emergency department that same day. All were wearing masks on arrival. As a result of the individual's symptoms and travel history they were admitted and tested.
Two earlier tests were negative for Covid-19, but a further test on Friday using a more specific sample proved positive.
Anyone who was on the final leg of the flight, Emirates EK450 arriving Auckland on Wednesday, and is concerned should contact the Covid-19 Healthline number 0800 358 5453.
Those people who were sat on the same row as the patient, and the rows in front and behind, would be contacted.
Temporary restrictions will be placed on travel from Iran as a precaution and New Zealand would not allow any exemptions for overseas students from China to enter the country, Health Minister David Clark said at the press conference.
The decision around an exemption for international Chinese tertiary students was in line with treating China as a "category one" country, Clark said.
The measures against Iran were made not just because of the increasing number of cases there, but concerns about the quality of information coming out of Iran. Iran's healthcare system was struggling to cope with a widespread outbreak, Bloomfield said.
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Another meeting would be held to look at the state of planning across Government for a "manage it"-type situation.
Clark said the Government was also bolstering the health presence at international airports.
The focus remained on keeping coronavirus out of New Zealand, helped by more travel restrictions and an increased border presence.
The situation in Iran was concerning, Clark said. "There is ongoing spread of the disease there, and a large degree of uncertainty about the scale of the outbreak and the ability to contain it."
The restrictions mean people will not be able to travel from Iran to New Zealand and anyone who has been in Iran in the last 14 days would need to self-isolate.
New Zealand citizens and permanent residents will still be allowed to return home, but will be told to self-isolate for 14 days.
The restrictions came into force immediately, and would be reviewed every 48 hours.
No exemptions for Chinese students
The Government had also decided not to allow any exemptions to let overseas students from China into New Zealand, Clark said.
"Our priority is protecting New Zealanders.
“Allowing thousands of students into the country from China, and guaranteeing they were safely in self-isolation, would have been incredibly difficult to implement."
Globally the virus has infected more than 83,000 people, and more than 2800 people had died - most of them in mainland China.
However, in the past week there have been more new cases outside China, with outbreaks in Italy, South Korea, Iran, Japan and Singapore.
Since early February New Zealand has banned the entry of foreign nationals who have travelled from or through mainland China in the past 14 days.
Meanwhile, thousands of New Zealanders returning from China have been asked to self-isolate at home.
From early on in the outbreak, the Ministry of Health has said it was highly likely that cases of coronavirus would be reported in New Zealand.
“Border restrictions are a key part of protecting New Zealanders. Immigration New Zealand is ready to implement the entry restriction on travellers from Iran to keep New Zealanders safe,” Immigration Minister Iain Lees-Galloway said.
“People should check with their travel agents about flight options if their travel plans are disrupted."
Health staff to meet more flights
Starting Saturday, health staff would meet all direct international flights landing at New Zealand airports from Hong Kong, Japan, South Korea, Singapore and Thailand.
Clark said information coming out of Iran appeared to be "out of step" compared with other countries experiencing outbreaks.
A number of airlines had already suspended flights to Iran, he said.
Bloomfield said while the World Health Organisation had not yet defined the global spread of the virus as a pandemic, New Zealand was effectively treating it as one.
The Government has also signed off on a $1 million fund available to key regions most affected by the travel restrictions put in place for Chinese visitors as a result of the coronavirus, such as Auckland, Rotorua, Queenstown and Christchurch.
"These places are taking a serious hit as a result of the down turn in Chinese visitors, and it's heartening to see the Government moving quickly to step in to help these regions mitigate the impact of reduced Chinese visitor numbers on industry and communities," said Regional Tourism New Zealand executive officer Charlie Ives.
A previous suspected case in January - also in Auckland - tested negative for the virus.