Tobacco products will now have to be hidden in stores, with retailers also banned from displaying trading names that refer to the products.
A law change, which comes into effect on Monday, means tobacco displays have to be removed from public view, as part of attempts to make New Zealand smoke-free by 2025.
Retailers who fail to follow the new law could face a fine of up to $10,000.
However, prosecution will be reserved for retailers who choose to flout the law, with District Health Board smoke-free officers initially focusing on educating those who may unwittingly be in breach.
The Government is also considering plain-packaging legislation.
The tobacco industry has signalled it will fight the new anti-smoking measures, with major player Philip Morris setting up a website urging smokers to make their opinions known to politicians and decision makers.
The New Zealand Association of Convenience Stores, of which British American Tobacco and Imperial Tobacco are members, on Friday said the ban was poorly handled and was another cost for shop owners.
Retailers were still left wondering exactly how the regulations would allow them to manage a major product in their shops, said chairman Roger Bull.
More staff time would be taken up getting customers particular brands, he said.
But Otago University health researchers say their survey of Wellington retailers showed most actually support the retail display ban.
The university was unable to supply the survey figures, but said most were "relaxed" about the new rules.
"Some thought the removal of tobacco displays would reduce smoking, and discourage young people from taking up smoking; others did not," said lead researcher Richard Jaine.
Most retailers were either ambivalent about selling tobacco or would rather not sell it, while none expressed positive attitudes towards selling tobacco, he said.