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The cheap fares are for flights between September and November. The sale lasts until Thursday.
The airline has also added more than 250,000 extra domestic seats from mid-August to October.
It says the move it to stimulate domestic tourism and "encourage Kiwis to travel to the regions".
Air NZ chief customer and sales Officer Leanne Geraghty said Kiwis' domestic travel was returning to pre-Covid levels.
"It's heartwarming to see Kiwis are getting out and about supporting our regions.
"We live in such a beautiful part of the world, so it's not surprising that our customers are making the most of it," she said.
"Rarotonga is also proving popular for those looking to escape winter, so we've recently added 25 per cent capacity to deliver Kiwis straight to the beach."
Air NZ's price-cutting follows Jetstar's move last week in a bid to get Kiwis exploring their own backyard while overseas travel options are limited.
The cheap flights included Christchurch to Wellington and Tauranga, as well as Dunedin to Auckland and Auckland to the capital.
Jetstar's 'Explore NZ Sale' ended at 11.59pm last night.