Waves around 4.5 metres high have started hitting Chile's coast in the city of Coquimbo, after an 8.3-magnitude struck off the country's capital.
A tsunami alert was issued after the powerful quake – initially measured at 7.9-magnitude – rocked Santiago.
The quake has been followed by 6.3 and 6.4-magnitude aftershocks, according to the US Geological Survey (USGS).
Chilean media is reporting at least two people have died and more than a dozen people are injured.
Tsunami alarms rang out in the port city of Valparaiso and authorities have issued a tsunami warning for the entire coast of the country.
The Chilean government has ordered the evacuation of some coastal areas, CNN reports.
Interior Minister Jorge Burgos said that the evacuation of coastal towns and cities was ordered as a precautionary measure.
People watch the ocean on Cerro Baron hill, Valparaiso city (Reuters)
The New Zealand Ministry of Civil Defence has issued a tsunami warning for the Chatham Islands, Coromandel Peninsula, Gisborne, Napier/Hastings, Christchurch North, Banks Peninsula and mid-south Canterbury.
Surges are expected to arrive around midnight, and strong tidal currents are likely to continue for 24 hours. The first wave might not necessarily be the largest.
Map of tsunami threat areas for New Zealand (MOCD)
Civil Defence is advising people in those areas to stay out of the water, stay off beaches and shore areas and listen to the radio and/or TV for updates.
"In these situations, a national tsunami panel, which includes a team of experts, advises [Civil Defence] of any potential threat to New Zealand," says Civil Defence Minister Nikki Kaye.
"In the last couple of hours there have been several meetings of the panel, and a tsunami warning marine and beach threat has been issued for East Cape, Chatham Islands, Coromandel and Banks Peninsula."
The Canterbury University Boardriding Association had planned a night surf at New Brighton Pier this evening, but organisers have put it on hold.
Residents stand on the street outside their houses (Reuters)
New Zealander Natalia Bogle lives in Santiago, and told 3 News the quake was terrifying.
"It was definitely scary, I'm not going to lie. It was quite long – that was what I noticed.
"It was scary. We've had a couple of aftershocks since then."
There are currently 60 New Zealanders registered as being in Chile, and 59 in Peru, according to the Ministry of Foreign Affairs and Trade.
Kiwis in those countries are advised to follow the advice of local authorities, including any evacuation orders and to stay away from areas immediately adjacent to the coast.
New Zealanders with family members in these areas are being advised to make direct contact with them, bearing in mind communications may have been affected by the earthquake.
In April last year, a deadly 8.2-magnitude earthquake in northern Chile killed six people and forced a million to leave their homes in the region around Iquique.
An 8.8-magnitude quake that struck Chile's Maule region in February 2010 was one of the largest ever recorded.
It killed more than 500 people and inflicted an estimated US$30 billion (NZ$47 billion) in damages.