Qantas and Jetstar have cancelled all services across the Tasman until at least midday.
Air New Zealand's also stopped flying to the South Island cities of Invercargill, Dunedin and Christchurch.
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The airline on Wednesday cancelled some flights in and out of Dunedin and on Thursday it cancelled some early flights between Invercargill, Dunedin and Christchurch and other main centres.
The airline said the cancellations were because of increased volcanic ash activity in the south of the South Island. The company said it would monitor the situation closely.
Until Wednesday Air New Zealand had been continuing to fly all trans-Tasman routes and also domestic routes at a lower altitude to avoid the ash cloud.
The airline was flying well below the ash cloud which has a ceiling of 8,229 metres, at the cost of burning 10 per cent more fuel.
Qantas and Jetstar has cancelled all Thursday morning flights to and from New Zealand.
Their passengers will have to wait until at least Thursday afternoon before their flights are cleared to take off.
Jetstar said in a statement it would not be flying into airspace affected by the ash cloud until it was confident it was safe to do so.
"The safety of our passengers, our people and our operations is always Jetstar's number one priority."
Affected passengers had the options of deferring travel, arranging to fly in to or out of unaffected airports, or getting a full refund.
Meanwhile, Qantas and Jetstar announced that all Australian flights would resume on Thursday.
The disruptions and cancellations have left thousands of frustrated travellers stranded on both sides of the Tasman.
