The Westpac McDermott Miller Regional Economic Confidence index recorded a 15.8-point fall in Otago's confidence to 21.8 in the March quarter.
Southland fell 3 points but only from 40 to 37.
In overall annual confidence levels, Southland was unchanged at 108.4 and Otago was down 10.1 points to 105.7, still in optimistic territory.
Westpac acting chief economist Michael Gordon said a net 22% of Otago households expected the region's economy to improve over the coming year.
''While that is down from December's 10-year high of 38%, confidence is still higher than a year ago, and above the long-term average of 17%.''
Tourism continued to provide a large boost to economic conditions in the region, especially in the Queenstown-Lakes District, he said.
The region was also feeling the benefits from a positive outlook for wine and horticulture, and construction activity was increasing.
However, conditions for the region's sheep farmers had been more challenging, Mr Gordon said.
Separately, the survey asked consumers' views on their own economic situation, producing an index summarising responses to questions, including how respondents viewed their own financial situation and their current willingness to buy a major household item. The regional breakdown showed consumer confidence in Otago fell sharply from 116 in December to 105 in March, he said.
''Consistent with a less upbeat view for the region's economy, Otago households have downgraded the outlook for their own finances.
''There was also a commensurate change in spending appetites.''
A net 15% of households in the region thought now was a good time to buy a big-ticket household item, the lowest reading in two years, Mr Gordon said.
In Southland, a net 37% of respondents expected the local economy to improve in the coming year, down only slightly from 40% in December.
That meant Southland was top of the regional confidence rankings for the first time since 2012, he said.
''It's been a dramatic turnaround from the most pessimistic region a year ago, when a net 22% of residents expected the regional economy to deteriorate.
''Given the importance of dairying in the region, the improved outlook for dairy incomes will likely bolster growth and employment prospects in the region.''
Aucklanders remained not very optimistic about the region's prospects but upbeat about their own economic fortunes and the outlook for the national economy.
