It is understood the attack was “ISIS-inspired” and was reportedly carried out by a Sri Lankan national.
The attack took place at the Countdown supermarket at LynnMall in the district of New Lynn on Friday afternoon and left six people injured.
A man reportedly took a large knife from a display cabinet in the store and went on a stabbing spree, however, he was reportedly killed by police within 60 seconds of the attack.
The man was under heavy surveillance at the time due to his ideological beliefs.
One witness told news outlet Stuff NZ: "[People were] running out, hysterically, just screaming, yelling, scared," he said, adding that he saw an elderly man lying on the ground with a stab wound.
The attacker, who is a man but cannot be identified, was inspired by the Islamic State terrorist group, Ms Ardern said.
In a press conference on Friday afternoon, Prime Minister Jacinda Ardern said: "What happened today was despicable, it was hateful it was wrong,"
"It was carried out by an individual, not a faith."
She added that she was "absolutely gutted" to hear about the attack.
The man had arrived in New Zealand in October 2011 and became a person of national security interest in 2016.
He had been under constant monitoring and heavy surveillance due to concerns about his ideology. He was known to multiple agencies and was also on a terror watchlist.
Ms Ardern said that until Friday, he had not committed any offences that would lead to arrest or detention.
When asked about the man's motivations, she said they were "ISIS-inspired".
When asked why actions were not taken against the man before he injured six people, Police Commissioner Andrew Coster said: "The reality is, that when you are surveilling someone on a 24/7 basis, it is not possible to be immediately next to them at all times.”
Coster added authorities are confident the attacker was acting alone and that there is no further danger to the community.