Mr Joyce becomes the most recent in a string of federal politicians to find he has violated constitutional laws preventing politicians from holding dual citizenship.
The citizenship crisis that has swept through the nation's parliament may be set to claim another victim.
There are revelations Deputy Prime Minister Barnaby Joyce holds dual Australian-New Zealand citizenship.
Speaking in parliament, Mr Joyce said he was informed by New Zealand's High Commission last week.
He says, after receiving legal advice, he has decided to continue his ministerial duties with the backing of the Government.
New Zealand prime minister Bill English has confirmed Mr Joyce's citizenship status.
"From the New Zealand point of view, it's simply a matter of the Department of Internal Affairs applying New Zealand law and, as I think Peter Dutton's outlined, they say that, unwittingly or not, he's a New Zealand citizen. And then it's a matter for the Australian system to decide how Australian law applies in his case and how they deal with the issue."
Mr Joyce's father was born in New Zealand and emigrated to Australia in 1947, a year before Australian citizenship was introduced as a concept.
The New Zealand government passport website indicates that makes Barnaby Joyce a citizen by descent.
And under Section 44 of the Australian Constitution, holding dual citizenship makes a person ineligible to sit in parliament.
The High Court is currently investigating five politicians over the dual-citizenship issue, including former Cabinet minister Matt Canavan and One Nation senator Malcolm Roberts.
The Greens, whose loss of two high-profile senators sparked the scandal, are insisting Mr Joyce step down.
Greens leader Richard Di Natale has told the ABC an external audit of everyone is needed.
"We've got to rely on the goodwill of each and every individual politician, and history shows us, that when we do that, systems fail. So what we have to have is a standard. And we set the standard, which was, you need to make sure that, if you're a dual citizen, you resign. That is not being met at the moment. We should have an independent audit, every single MP."
Labor MP Anthony Albanese says the incident again puts the spotlight on the individual parties' vetting processes for politicians.
"The other parties will have to explain their own circumstances. Labor has in place a very rigorous process when we nominate of providing evidence that we're eligible to nominate, and that's, I guess, one of the reasons, no doubt, why there is no-one from Labor (who) has been caught up with these issues."
Malcolm Turnbull has written to Labor leader Bill Shorten, asking him to nominate any Labor members or senators who could come into questions under Section 44.
Mr Turnbull says parliaments could then refer all such matters together to the High Court.
He had previously described the resignations of the Greens politicians as a result of being "sloppy."
But Treasurer Scott Morrison denies Mr Joyce's situation falls into the same category.
And he maintains, despite the problem, the Coalition is concentrating on the issues of the day.
"There's a very clear path forward on this, and the Government will remain focused on our job, which is to manage the nation's finances, keep Australians safe, ensure that we're guaranteeing the essential services, as I said, in this year's budget, put downward pressure on cost of living. One of the key issues that Barnaby is working on, together with myself, the Energy Minister and the Prime Minister, is on getting people's power bills under control, giving them greater power to have more power over their power bills. So, that's the job the Australians want us to focus on."
If Mr Joyce is found ineligible, the Government -- which holds a one-seat majority in parliament -- would have to hold a by-election.
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