"Time spent in front of the TV reduces the amount of time children spend outside participating in developmentally enhancing activities," early childhood adviser Kirsty Carling said.
"This inactivity has an impact on the ability of children to develop the basic movement skills they need to play sport, for example."
Research in recent years also suggested excess television watching led to anti-social behaviour, problems with language development and limited attention span in children, Ms Carling said.
Nationally, more than half of those surveyed spent more than 10 hours each week watching television.
Couch potatoes seemed more prevalent outside the main centres - with large numbers of Northland (60 %) Hawkes Bay (59 %) and Central North Island (58 per cent) respondents admitting to watching more than 10 hours a week.
This dropped to less than 50 per cent for Auckland.
Freeview general manager Sam Irvine said while city dwellers reported watching less TV, they were more likely to be "double screening" or browsing the internet when in front of the box.
"The survey shows 64 per cent of viewers in Auckland, Wellington and Christchurch regularly browse the web while watching TV, compared to 56 per cent of those living in the regions."
Bed-time viewing was less popular, with about 43 per cent of respondents saying they watched TV in bed.
International research from Boston College, which tested 900,000 children in 50 countries, found 69 per cent of Kiwi 9 and 10 year olds, and 62 per cent of 13 and 14 year olds were identified by teachers as being adversely affected by insufficient sleep.
While the research did not examine why children lacked sleep, Principals' Federation president Philip Harding said increased technology use in the home could be a factor.
"Light [from electronic screens] suppresses the development of melatonin, which helps you go to sleep.
"Today kids and adults sit and watch television on a big flat screen and they've got computers," he said.
"They are doing the exact opposite of what they need to be doing to get to sleep.".
Our TV habits:
TVs per household - BOP 2.06, NZ 2.17.
Watch more than 10 hours of TV each week (%) BOP 57.43, NZ 53.48.
Watch TV in bed (%) BOP 39.53, NZ 43.32.
Browse internet while watching TV(%) BOP 56.08, NZ 58.86.
Source: Freeview television survey
- additional reporting Nicholas Jones