A massive earthquake measuring 6.8 on the Richter scale struck New Zealand on Thursday evening, collapsing three buildings and starting several fires in the city of Gisborne, on the east coast of the North Island, but there were no reports of serious casualties.

Police cordoned off the main street where the roofs of several shops collapsed and windows were smashed, urging sightseers to go home away from unsafe buildings and glass-covered footpaths.

Firefighters extinguished about 10 fires which broke out when gas and power lines fractured, plunging the city into darkness for about 40 minutes.

A reporter for the Newstalk ZB radio network said a huge hole had appeared in one of the main roads and the city was in a state of chaos.

Gisborne mayor Meng Foon told Radio New Zealand that about 10 people had been treated for minor injuries at the city's hospital which was without power for about half an hour.

Thousands of people were shaken by the quake, which was centred under the sea 50 kilometres off Gisborne, and reportedly felt 1,250 kilometres away in the South Island city of Dunedin, according to Radio New Zealand.

It was New Zealand's most damaging quake in 20 years and casualties were light because it struck shortly before 9 pm when shops in the central business district of Gisborne, which has a population of about 33,000, were closed.

"It felt like the whole house was shaking from side to side," a Gisborne woman told Radio New Zealand.

Seismologist Warwick Smith, of GNS Science, told the Newstalk ZB radio network that damage from the quake would have been much worse had it been centred on land.

The national crisis management centre in Wellington was activated but Civil Defence director John Hamilton said scientific experts had advised there was little risk of a tsunami because the quake was centred 40 kilometres below the surface.

Seismologists at GNS Science record about 14,000 earthquakes a year in and around New Zealand, about 100 to 150 of them big enough to be felt.

They rate quakes between 6 and 6.9 magnitude as "strong" and say about 120 a year of that strength are recorded around the world.

The scientists said that records dating from the 1840s showed that, on average, New Zealand can expect several magnitude 6 earthquakes every year.