Christchurch's Rolleston prison will be cleared to create beds for the influx of rescuers into the city following yesterday's 6.3 magnitude earthquake.
Corrections Minister Judith Collins said the prisoners would be moved to the higher security Christchurch Mens' prison, emptying 320 beds for rescuers. The rescue teams now include 200 police from Australia on top of their specialist search and rescue team.
In a further bid to make room in the city the Air Force was today ferrying tourists and out-of-towners from Christchurch to Wellington and Auckland to clear hotel rooms and other accommodation for rescuers.
The rescue teams were being flown to Christchurch on the return leg. Hundreds of people were expected to use the flights today.
Civil Defence National Controller David Coetzee said as well as rescue teams, council workers including building inspectors and sewage workers were now being drafted to Christchurch to help assess buildings and restore basic services.
Rescuers have recovered and identified 55 bodies and are yet to identify a further 20 bodies from yesterday's earthquake in Christchurch.
Christchurch Mayor Bob Parker said 300 people were also listed as missing.
"With those 300 missing people could just be someone called up saying so and so is missing - they may have just left town," he said.
Announcing a national state of emergency had been declared, Prime Minister John Key said the whole country was grieving.
Mr Key said the lives lost were the "greatest loss".
"Buildings are just buildings, roads are just roads, but lives are irreplaceable."
He said the whole of New Zealand was with Canterbury.
"Today all New Zealand grieves for you Christchurch," he said.
But he said the city would recover.
"Though lost lives will never be replaced, and though your city will never look the same again, you will rebuild your city, you will rebuild your lives, you will overcome."
The Air Force has been helping to evacuate people from Christchurch.
A Royal New Zealand Air Force C-130 Hercules aircraft evacuated people from Christchurch to Wellington this morning, and a second will follow, the Defence Force said.
It said staff had been preparing for a large exercise in the region and were now instead helping with the rescue effort.
"Medical teams are working with local health officials and soldiers are manning cordons around the city. Army ambulances and personnel are assisting with various search and rescue tasks throughout the city," it said in a statement.
It said military staff from Singapore and Australia were also helping.
An Australian Defence Force C-130 aircraft has brought in the first group of Australian search and rescue staff.
"Soldiers from the Singapore Armed Forces are also providing personnel to man the cordons in the city."
About 950 people spent the night at two welfare centres, at Hagley Park and Burnside High School, where blankets, food, sanitation were supplied.
Social Development Minister Paula Bennett says more welfare centres would be opened once buildings are declared safe to use.
"The advice is to stay at home if people can and to check on their neighbours and if they need any help or advice, call the Government helpline," says Ms Bennett.
The 0800 779997 helpline will operate 24 hours, providing information, advice and transferring calls through to other appropriate agencies.
"Financial assistance will also be made available to those who need it, we have the ability to provide Civil Defence emergency payments and other assistance is available," Ms Bennett said.
Telecommunications were patchy and many residents did not have drinking water.
Roger Sutton, CEO of Orion Power, said half the city was still without power but he hoped that by the end of today that 70-80 percent of the city would be back online.
Bob Parker told Breakfast at least six schools would be used as water distribution centres. Water tankers were due to arrive at 11am. The schools were Lyttelton, Redcliffs, South New Brighton, Shirley, Wainoni and Phillipstown. Steps were also under way to get food supplies in.
Mayor Parker urged people to stay at home, saying the city was effectively "closed" for at least the next three days.
He said portable toilets were being brought into the city to help ease the impact of waste water.
People with minor injuries were advised to go to smaller medical centres around the city rather than Christchurch Hospital, he said.
Christchurch Airport reopened for domestic flights this morning and it is expected the backlog will be cleared by the end of the day.
Check-in counters opened at midday, but airport chief executive Jim Boult said people should not come out to the airport unless they had a confirmed booking on an international flight.
Air NZ chief exectuive Rob Fyfe said there had been a lot of demand for flights into and out of Christchurch. A 300- seat Boeing 777 aircraft organised to leave Christchurch later today sold out in 14 minutes.
Disrupted passengers spent the night at the airline's operations centre, where they slept on the floor. "They were all in really good spirits," said Fyfe. Around 50 extra Air NZ staff members, most from its "special assistance teams" had been sent to work in Christchurch as a result of the earthquake.
Meanwhile, aftershocks have continued to hit Christchurch. GNS Science reported two aftershocks within eight minutes after another measuring 3.9 struck at 2.31pm
- NZHERALD STAFF, NZPA, NEWSTALK ZB
Information about what's been damaged in the aftermath of the magnitude 6.3 earthquake and where people can get help:
View Christchurch earthquake: Map of the destruction in a larger map