A close friend of Kaye's, who did not want to be named, told RNZ the former MP for Auckland Central passed away after a long battle with cancer.
Former colleague and National MP Maggie Barry posted on Facebook today a picture of the pair with the caption "farewell my friend".
Kaye was in Parliament for 12 years, entering in 2008 aged 28, before announcing in July 2020 she wouldn't contest the upcoming election.
Kaye had worked for Bill English when he was Leader of the Opposition in 2002.
In January 2013, she was appointed to Cabinet by then Prime Minister Sir John Key, eventually holding ministerial (and associate) responsibilities for ACC, Civil Defence, Education, Food Safety, Immigration, Youth and Youth Affairs over the next seven years.
In 2016, Kaye took leave after being diagnosed with breast cancer at 36 and returned to Parliament and her ministerial roles in 2017 after successful treatment.
She held the electorate of Auckland Central during her entire time in Parliament, overthrowing Labour's Judith Tizard in 2008, and was the first National MP to win the electorate.
She became the Deputy Leader of the National Party in May 2020 when Todd Muller took over from Simon Bridges.
Kaye has always been more on the socially liberal side of the National Party, voting in favour of MP Louisa Wall's Marriage (Definition of Marriage) Amendment Act 2013, allowing same-sex couples to legally marry.
In an interview with RNZ's Nine to Noon programme in 2020, Kaye spoke about having breast cancer.
"The other thing is, being diagnosed with breast cancer, and I've not talked in detail about my health before, I don't see life as a situation whereby you can always plan things and my view is that you have to live every moment and I have given everything to the party and the country," she said in tears.
"You have to know when your time is up and you've given it your all."
Prime Minister and National Party leader Christopher Luxon and Deputy Leader Nicola Willis said they are deeply saddened by the passing of Kaye.
Luxon said in a statement Kaye was a cherished colleague, friend, and former minister.
"Nikki's contribution to our party, her community, and New Zealand has left an indelible mark. Her tireless dedication, sharp intellect, and tenacity earned her the respect of people across the political spectrum," Luxon says.
"Nikki was a remarkable person and a crusader for what she believed in, and her contribution has left our country in a better place."
Willis said Kaye was one of the bravest Parliamentarians New Zealand has seen.
"She was not only a colleague, but a brilliant friend to many of us. She was fiercely committed to her constituents and her values and she contributed so much of her soul to this country party and our party.
"Our thoughts are with her family and loved ones during this incredibly difficult time," Willis says.