Emergency services were called to the Omarama Top 10 Holiday Park at about 1.20pm today.
Holiday park owner Erwin Beiboer said he had not seen anything like it before.
The tornado lasted for a few seconds in an area with caravans and tents, he said.
"There were people in the tents and were lifted up a few metres, luckily the tent was open so they could actually fall out [and] jump out," Mr Beiboer said.
"The tent went up a few hundred metres... over our trees into the neighbour's paddock."
The campground was booked out with holiday makers.
Emergency services remained at the scene checking over "mainly frightened" people over, he said.
A Hato Hone St John spokeswoman said one ambulance had been sent to the incident and initial indications were of minor injuries.
"Four patients were assessed and treated at the scene, all in minor conditions, no transport required."
A Fire and Emergency spokeswoman said two fire appliances had been sent to assist ambulance staff.
MetService meterologist John Law told RNZ a tornado in the area was "definitely not out of the question".
There was a "very active" weather situation across the whole country, with thunderstorm and rain warnings in place in several parts, mostly on the East Coast of the North Island.
"Even down across the South Island we've seen some really active showers and thunderstorms."
Law said although there was no record of strong winds or tornadoes in the area, such weather phenomena could be highly localised.
"Really strong, gusty straight line winds can be enough to lift things up like tents", he said, and were common during thunderstorms such as have been crossing the country throughout the day.
It would be difficult to determine whether the incident had been caused by a gust of wind tornado without seeing footage from the scene, he said.
Regardless, "both can be pretty strong, both can cause damage, and both situations are entirely possible in the set up we've got at the moment".
A severe thunderstorm watch remains in place for Gisborne, Hawkes Bay, Marlborough and Nelson until 9pm tonight, while heavy rain watches are in place for Wairoa District, Gisborne/Tairawhiti south of Tolaga Bay, Hawke's Bay south of Wairoa, Tararua and Wairarapa until Tuesday evening. The heavy rain watch for Marlborough expires at 9pm on Monday.
- additional reporting from RNZ
