Individuals and body corps could be fined up to $50,000 to $200,000, or up to two years jail for posting or sending a cyber-bullying post likely to cause harm.
Last night the Harmful Digital Communications bill passed its third reading in Parliament.
The bill covers racist, sexist and religiously intolerant comments, plus those about disabilities or sexual orientation.
The changes could see up to three years jail for the new crime of incitement to suicide.
An "approved agency" will advocate on behalf of complainants, who will make direct contact with web publishers and social media sites where a member of the public often has trouble being heard.
Netsafe's Executive Director Martin Cocker says approximately 20% of secondary school students are directly affected by cyber bullying each year, and this year, 1 in 10 adults in New Zealand say they have been affected by online harrassment and abuse.
He says, "The Bill gives people who are being harrassed or abused online, somewhere to turn. It puts a set of tools in place for them to respond and get a positive outcome."