New Zealand troops will stay in Afghanistan for another year and could stay past 2008 as the rebuilding of the fragile nation continues.
A frigate is also again being deployed to the Gulf.
However, the Government says it cannot send greater numbers of troops to Afghanistan in case of trouble closer to home.
Prime Minister Helen Clark and Defence Minister Phil Goff said the Cabinet had confirmed NZ's contribution in Afghanistan would be rolled over for another year until September 2008 at a cost of about $30 million.
A frigate would also join the maritime interdiction operation in the Gulf for just over a month during the middle of next year.
This leg would be added to a planned deployment to the South/Southeast Asia region.
Helen Clark said the Government decided each year whether to roll over the deployment in Afghanistan and she doubted this would be the last.
"I'd be surprised if the job isn't still going after that but we've tended to take the decisions a year at a time."
Mr Goff said New Zealand troops had been in Bamyan for 3-1/2 years and he was "proud" of the work they had done there.
He said New Zealand's continued presence in Afghanistan would depend on its other responsibilities and requirements on it in other parts of the world.
It could not send more troops to Afghanistan because it might need to send them to hotspots closer to home, such as in East Timor or the Solomon Islands.
New Zealand has 400 troops currently deployed overseas, not including those on board the frigate going to the Gulf.
The New Zealand SAS conducted operations in Afghanistan between December 2001 and November 2005 but Miss Clark said Cabinet had not considered sending them back.
This was welcomed by Green foreign affairs spokesman Keith Locke who said it was good the SAS would not be part of the "military debacle" in the south of Afghanistan where "trigger-happy" American forces had only made matters worse.
"So many civilians have been killed in Nato's bombing raids that the Taleban extremists are, unfortunately, staging a comeback," Mr Locke said.
* 120-personnel Provincial Reconstruction Team in the Bamiyan province.
* Two personnel based with the British contingent to help train the Afghan National Army.
* Up to five officers to serve with the International Security Assistance Force (ISAF) headquarters.
* Four police officers to help train the Afghan National Police.