The Trans Pacific Partnership (TPP) bill has passed its first reading at Parliament by three votes.
Trade Minister Todd McClay told Parliament the TPP would not prevent the government from making good decisions.
Mr McClay said the trade deal would maximise opportunities for exporters and create a stronger economy.
"TPP is our largest free trade agreement to date and places us centrally in a region encompassing nearly 40 percent of global GDP - TPP will deliver benefits to New Zealand and ultimately to all New Zealanders."
However, Labour MP David Clark said the government had taken a wilfully arrogant approach to the TPP which had destroyed the traditional bipartisan political approach to free trade in the country.
He said the government had failed to protect New Zealand's sovereignty.
The bill passed 62 votes to 59.
National, Act, United Future and Labour's Phil Goff voted in favour while the rest of the Labour Party, the Greens, New Zealand First and the Maori Party opposed the bill.