Auckland has been granted a licence to enter the competition next year with the club to be backed by American billionaire Bill Foley.
The Auckland side will join the Wellington Phoenix in the league and New Zealand Football chief executive Andrew Pragnell said the country can support numerous clubs.
"I actually think we've got enough players for three clubs," Pragnell told RNZ's Morning Report.
"Auckland is one of the largest cities in the world without a professional football club," he said.
"We know we're producing the talent but it's often bypassing parts of Auckland and going straight into Australia or onwards.
"Absolutely there is the talent and I think there is scope for a professional South Island team as well in due course."
Pragnell said the competition between the Phoenix and the new Auckland club will drive improved performance from both sides.
It's been 17 years since Auckland had a side in the Australian League, with the Football Kingz from 1999-2004 and the New Zealand Knights 2004-2007.
Bill Foley is a sports fanatic.
He owns Bournemouth in the EPL and in 2017 started the Las Vegas Black Knights, who won the Stanley Cup last year.
Pragnell believes Foley's involvement gives the new club security.
"Bill obviously has extreme wealth, but he also has experience in building teams.
"He is a multi-club owner and has produced a title winning team in the NHL (National Hockey League).
"He's already begun recruiting management and he's here to stay."
