RNZ head of content Carol Hirschfeld said RNZ would recruit a second reporter to join its sole Dunedin-based journalist, Ian Telfer, to cover news in the lower South Island.
The decision to close the office, which was established in 2005, follows the recent resignation of reporter Peter Newport.
Ms Hirschfeld told the Otago Daily Times she did not see the closure as a cost-cutting measure.
"The real cost-cutting would be ... if we didn't replace the reporter ... We are replacing the reporter and we're optimising the resources that we have currently.''
She also denied RNZ's coverage of Queenstown issues would suffer as a result.
"We recognise it's easier to cover a range of different issues when you've got somebody on the ground in a particular centre, but we aren't reducing the number of regional reporters, we're retaining the number.''
Working as a sole-charge reporter was a "tough, tough road'', and having two journalists working together in Dunedin was a case of "optimising the resources we have currently''.
"Of course I'd love to have two reporters in all our regional centres, but the reality is that we are utilising and spending our money in a way that is responsible and maintaining our coverage as well as we possibly can.''
But veteran RNZ Queenstown reporter Steve Wilde told the Mountain Scene this week it would be a mistake to close the office.
Mr Wilde, who quit last year after a decade in the role, said the region needed to be represented on public radio.
However, the closure was RNZ's response to not having received a budget increase for eight years.
RNZ has also closed its Tauranga and Palmerston North offices in recent years.
Ms Hirschfeld said there was internal interest in the second Dunedin position and she hoped it would be filled quickly.
Having two reporters in Dunedin could enhance RNZ's coverage of the city's issues, she said.
"There's a lot happening in Dunedin as well - it's one of the few cities in New Zealand showing real signs of growth.''
