A vapour, described by a Queenstown sushi restaurant owner as resembling tear gas, was released in the restaurant in the resort on Tuesday night, leading to the evacuation of 23 patrons.
Police were called to Kappa Sushi in The Mall about 10pm after a tall bearded male, who was in a group of 17 backpackers, set off a gas, forcing diners to be rushed downstairs to safety.
The gas caused patrons throughout the restaurant to cough and bringing some to tears.
Owner Nao Higuchi said he "kicked out" the 17 backpackers, who were on a bus tour.
Six customers did not have to pay because he felt their experience had been tarnished, but one Canadian from the group of 17 had paid the money Mr Higuchi had lost.