Prime Minister Helen Clark says Fiji's military chief seems to be favouring a "Thailand-style" coup.
In September the Thai military overthrew Prime Minister Thaksin Shinawatra in a bloodless coup that had the support of the country's king.
Helen Clark today said Fiji's military strongman, Commodore Voreqe (Frank) Bainimarama, seemed to be attempting something similar as he ratcheted up the pressure on Prime Minister Laisenia Qarase to resign.
"Clearly his preference is for something like a Thailand-style coup which the king in effect wished well and waved on its way," she said on National Radio.
"Hence the extreme pressure that's gone on the president and gone on the prime minister to actually resign and do the commander's job for him."
Yesterday Mr Qarase told her he had no intention of stepping down despite military roadblocks to try and stop him re-entering Suva and soldiers confiscating weapons from the country's police force and patrolling Suva's streets.
Military checkpoints remained in place around Suva today.
Helen Clark said Cdre Bainimarama's tactic was to "traumatise" Mr Qarase and limit his freedom of movement to the point where he could no longer govern.
She yesterday left no doubt about the consequences if the army seized power, saying anyone linked with a coup would be banned from entering New Zealand and the military assistance programme would be suspended.
Aid was likely to be frozen, although ways would be found to continue helping the Fijian people outside Government channels, she said.
"Should the worst happen, of course there will be a range of measures and Mr Bainimarama was put on full notice of that when he met [Foreign Minister] Winston Peters in Wellington."
The first step would be to draw up a list of those responsible and ban them from entering New Zealand, she said.
"Given that Mr Bainimarama has close family in New Zealand, that should weigh on his mind."
The military assistance scheme helped to train Fijian soldiers for international peacekeeping, she said.
"Fiji's military relies on international peacekeeping for significant funds. If it can't deploy because it can't be trained up to a standard of readiness, that would be quite devastating for Fiji's military force."
As soldiers spread through Suva last night, sketchy plans emerged for an Eminent Persons Group to be sent to the Fijian capital in a last-ditch bid to stop a coup.
The proposal is understood to have come from the meeting of regional ministers in Sydney late last week, but New Zealand Government sources said if it did get off the ground it would probably be too late.
Mr Peters could be a member of it, although he has to leave for the Philippines by Friday at the latest for the Association of South East Asian Nations summit in Cebu.
Helen Clark endorsed his participation yesterday, but Mr Peters today said he would be calling Cdre Bainimarama before the group was due to leave to check whether he would receive it.
If he flatly refused then Mr Peters would not go.
Mr Peters said events of the past day were a coup.
"There is a creeping siege on democratic institutions in Fiji," he said on National Radio.
"It is a coup in a sense, but not one in the nature (we've seen) in other countries ... but it is a coup nevertheless."
Mr Qarase was showing "enormous courage" to stand his ground, he said.