Customers on the XT network south of Taupo had difficulty making and receiving calls, sending and receiving text messages and using broadband on their mobiles from yesterday afternoon.
Telecom initially denied there was a problem before updating its website with notification of the system disruption at 5.50pm.
At 12.05am, the company said it was continuing work to restore service to the remaining affected cell sites.
Its chief executive, Paul Reynolds, would speak about the latest outage this afternoon, Telecom said.
The company's network also had outages last week, following on from a major failure in mid-December and another in late January, in which up to 200,000 customers south of Taupo were cut off for up to three days.
Telecom's XT network partner, Alcatel-Lucent, announced yesterday that its New Zealand chief executive Steve Lowe was leaving the company and would be replaced by Jyoti Mahurkar-Thombre, effective from March 8.
In May last year Alcatel-Lucent said the launch of the XT network was the latest milestone in a successful partnership between it and Telecom.
