Love is in the Air, which depicted two children on a bench, has been removed from the Mansfield Apartments building on the corner of Bond and Liverpool Sts.
The mural was painted by Polish artist Natalia Rak in May 2015, and is described as "characteristic of her cheeky, playful and hyper-realistic style" in the Dunedin Street Art Trail map.
Dunedin Street Art Trust chairman Scott Muir said on Monday he did not know why the mural had been painted over and declined to comment further.
A post made late this morning on the Dunedin Street Art Facebook page said the group knew why the owners had removed the mural and was working with them to replace it.
"We were aware from the owners that they needed to undertake repairs to the wall and that the mural would need to be removed. They indicated they would be keen to host another mural and the DSA will work with them to do this now the wall has been completed. We’re working together now to come up with options for a new mural on that wall," the post said.
An employee at nearby cafe Vanguard said the image was painted over about two weeks ago, leaving staff wondering why.
"We loved it and now it’s gone, and it doesn’t make any sense because it’s just a blank piece of wall now, and it was such a beautiful picture beforehand."
Dunedin needed to value its street art, as it added to the character of the city, she said.
She hoped it was a matter of planned maintenance and the space would be available for another piece.
The mural caused debate in 2015 before gaining consent.
In submissions to the city council, one apartment owner raised concerns about how it would impact property value, and another said murals should be limited to areas where they did not impact residential dwellings.
