"I have informed Greyhound Racing NZ that I am not satisfied the recommendations are being implemented in a way that is improving animal welfare, and with their failure to provide sufficient information on changes they are making.
"It is the responsibility of the industry to hold itself accountable and ensure the best possible standards of welfare for greyhounds. Should the review show that progress has not been sufficient, a further fundamental look at the greyhound racing industry may be required."
Sir Bruce Robertson, a former senior judge and the current Chair of the Racing Integrity Establishment Board, has been appointed to lead the review.
His judicial background and prior experience with the wider industry makes him well qualified to lead the review, the Government said.
Associate Agriculture Minister Meka Whaitiri said the review would be completed by August 1 to allow the incoming Racing Integrity Board to pick up any changes from the start of the new racing season.
"I had written to Greyhound Racing New Zealand suggesting that they may wish to continue regular progress reporting on the recommendations from the Hansen Report. That suggestion was not acted on and this review will now address these matters," Whaitiri said.
The announcement comes after six dogs suffered broken legs at New Zealand greyhound races in the past two weeks.
Last Sunday, in a video broadcast by the TAB in Race 3 at Auckland, greyhound All Day Long suffered a fall and broken leg. On the same day at the same track, Spring Timmie suffered a broken leg.
Seven greyhounds have died and over 270 injuries have been sustained at races in New Zealand, according to animal welfare group Safe NZ.
Safe NZ boss Debra Ashton said: "As long as there is greyhound racing in New Zealand, dogs will continue to suffer."
Earlier this week, Kiwibank announced that it is offering a block on online gambling transactions to help customers curb addiction.
"We are seeing leadership from private industry who are taking action to condemn the ills of gambling," said Ashton. "This is an industry that hurts animals and people."
A petition, supported by Safe, calling for a ban on commercial greyhound racing was launched by Greyhound Protection League of New Zealand in September 2020. So far it has been signed by 26,420 people.
"No 'athlete' is expected to die for their sport," said Ashton. "It's time for this gross abuse of dogs to end."