The average temperature during 2016 was 13.4 Celsius (56.1 Fahrenheit), according to a report released Monday by the National Institute of Water and Atmospheric Research.
That was nearly 1 degree Celsius warmer than normal and fractionally hotter than the previous record set in 1998. The climate agency began keeping records in 1909.
Agency forecaster Chris Brandolino said ocean temperatures around New Zealand were warmer than normal for the first seven months of 2016 and that winds during the year came more often than usual from the north rather than the cooler south.
He said there was no clear reason for the 2016 changes but that they had come against a backdrop of global warming caused by increased carbon emissions.
"We are expecting temperatures to continue to rise," Brandolino said. "It's very concerning."
New Zealand's economy relies on farming, an industry which is particularly dependent on the weather.
Anders Crofoot, the vice president for advocacy group Federated Farmers, said sheep and beef farmers in north Canterbury were hit by a drought last year.
He said one downside of climate change was the possibility of more volatile weather, such as heavy but infrequent rainfall.
He said in the longer term, climate change could force farmers like kiwifruit growers to move or consider alternative crops as the weather became less favorable to them.
He added that certain crops like avocados and oranges could benefit from warmer weather.
He said farmers were beginning to talk about climate change more and to consider it their planning. He said many farmers were trying to find ways to reduce their own carbon emissions and farm more efficiently.