The move comes as politicians including Mr Peters, Conservative leader Colin Craig and Act leader Jamie Whyte call for the abolition of the Maori seats.
Mr Peters, who on Tuesday warned "separatism is coming to a council near you", yesterday said New Plymouth's plan was a stop on "a disastrous path down which this country is going to go".
Despite the fact that Maori ward representatives would be voted in by those registered on the Maori parliamentary electoral roll, Mr Peters said they would be "non-elected, accountable to no one at all, and will cost significant amounts of money to ratepayers".
When it was pointed out Maori ward councillors would be elected, Mr Peters said the majority of Maori were on the general roll "so they've been disenfranchised too because they can't vote for these guys".
"This complicated separatist path is not something that's going to help any Maori in the long run. It will cost Maori and cost the community as well."
Asked yesterday about the council's plan, Prime Minister John Key was relaxed.
"It's totally a matter for them. It's devolved to local councils and they can make their own call.
"There are councils around New Zealand that have Maori seats, there's some like Auckland that have a Maori advisory board and some that don't want any Maori representation. You've got to work with your local community and what you think best represents them and councils are accountable to their ratepayers just like the Government is."
Labour's local government spokesman, Su'a William Sio, said Waikato and Bay of Plenty Regional Councils already had Maori wards.
"It's not a new precedent, it's something that's already available for local governments to establish. In this day and age, obviously there will be some people uncomfortable with it but I think New Zealand has changed and more and more of us are recognising that Maori do have a significant role to play in our environment, in our planning and in supporting the desires of the regions to grow."
