Three new courts will be built and two upgraded as part of a $39 million Budget investment.
Courts Minister Rick Barker said about half of the country's 72 courts were 50 years or older and a quarter had logged up a century.
He announced $17.5 million for land to be bought for a court in New Plymouth and for new courts in Invercargill and Levin.
Mr Barker said the 100-year-old Levin court was like a "doll's house" and the dock was within arm's reach of the judge.
The remaining $21.5 million would go to overhauling and expanding the Hastings court and expanding Manukau District Court.
Mr Barker said Manukau would have two new large multi-defendant courtrooms for High Court and District Court trials.
"Manukau is a new court, but anyone who has been to Manukau court while it's been in operation can tell you that building is severely stressed. There are simply too many people, too little space, too much activity and the staff areas are, bluntly, unacceptable."
Staff had been working in closed-off corridors and meeting rooms.
The funding is part of a 10-year capital works programme to improve court buildings. Courts in Greymouth, Queenstown and Whangarei have recently been improved or received funding for work.
"This is a very important catch-up step," Mr Barker said.
"There are other courthouses that need to be done [but] we simply don't have the resources or the capacity to undertake improvements at any greater rate."
Another court he singled out as unsatisfactory was Timaru, which was built in 1877 and had not significantly changed.
Several courts had not changed to reflect population growth and expanded services such as Family Court, Youth Court and tribunals.
All new and upgraded courts would have improved security - a single main entranceway would be equipped with a metal detector and search area, said Mr Barker.
Witnesses and defendants would have separate waiting areas, and security cameras would be installed.
"There's been a number of security breaches at court recently and I am sure the new security measures will greatly improve the courts' ability to manage security incidents," he said.
Prisoners would also have more secure entrances - at Blenheim and Timaru courts prisoners were escorted through a public waiting area.
- NZPA
New courts, upgrades and security to cost $39m
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