Foreign Affairs Minister Winston Peters says he will not be cowed by threats of legal action, having received a legal letter from Bob Carr.
Peters attacked the former Australian senator's critical views of the AUKUS security pact on Morning Report on Thursday.
Carr threatened defamation action and his lawyers have now written to Peters, informing him they intend to launch legal proceedings.
Speaking to reporters after a talk at the New Zealand China Council on Friday morning, Peters said he had done nothing wrong.
"I've been on the stage internationally for a long time and I'd never go and talk to any country and tell them what they should be doing," he said.
"This is a serious matter and we're not going to slide by it. You might be cowed by threats of legal action [but] I'm not."
AUKUS has been a contentious talking point since Labour hosted Carr, and others critical of AUKUS, at Parliament last month.
This followed Peters and US Secretary of State Antony Blinken saying the two countries had "powerful reasons" for New Zealand to engage with AUKUS.
Peters on Friday repeated points he made in a speech earlier this week; that Labour had started the process and New Zealand was a long way from making a decision about participating in Pillar 2.
"I'm not angry, I'm massively disappointed because we haven't got anywhere near the level of discussions for us to even progress the matter at this point in time," he said.
"We have never had the precondition first satisfied that we have been invited to join or the second post condition that we will accept to join.
"All these matters are in the air at this point in time. You all know it and yet there are people who were the originators that hatched this idea in the first place and began it all now shouting alarm. How can they possibly get away with that?"
Peters said he did not believe his comments would damage New Zealand's bilateral relationship with Australia.
