Police say a dispute between neighbours triggered an armed offenders squad callout in the Coromandel Peninsula town of Thames.
Parts of the town were cordoned off for several hours on Saturday afternoon, after police received reports of a man firing a gun at a passing car.
Acting Detective Inspector Ross McKay says the police believe two women had a fight in the middle of their street, and a male friend of one of them tried to intervene.
Several people made emergency calls, including reporting hearing a handgun being fired.
That prompted a huge police response, including the armed offenders squad, police dog handlers and a police helicopter.
However, Mr McKay says they have not spoken to any witnesses who actually saw a gun being fired.
They have been speaking with the two women but have not decided whether to lay any charges.