Two male pot-bellied sea horses gave birth to several hundred babies at the University of Otago aquarium.
The male of the species carries fertilised eggs in a pouch in their chest.
Volunteer Megan Wiedeback was cleaning the aquarium on Wednesday when she noticed "sea ponies" in the sea horse tank.
She rushed over to see one of the sea horses in the process of giving birth.
"There was a bunch of tails sticking out of his chest - it was pretty bizarre."
She ran to fetch other staff members, who got there in time to see "a cloud of babies" in the water.
Manager Tessa Mills said the event was very exciting.
It was unusual for sea horses to breed at this time of year, she said.
Aquarist John Campbell attributed the unseasonal breeding behaviour to warmer sea temperatures.
He said he knew the males were pregnant because "they go all gloomy and hide in the seaweed".
The babies were about 6mm long and could fend for themselves from day one.
They were removed from the tank before the adult sea horses mistook them for food, and staff later released them into the harbour.
- Lisa Holland
