The teddies are a donation from the charity Teddies For Loving Care and were an ongoing initiative over the next three years.
More than 20,000 colourful teddy bears would be distributed to children around New Zealand. Tauranga Hospital was one of the first to receive its first lot of the cuddly soft toys.
Teddies for Loving Care chairman Tony Mansfield said the initiative was first created in England 15 years ago and New Zealand was the first country outside of Europe to adopt the idea.
Mansfield said a "conscious decision" was made to give the first lot of teddies to smaller regional hospitals in time for Christmas.
"The idea does work, when children are experiencing trauma or are stressed the teddies will calm them down."
The teddy bears have been made to be robust to be pointed and prodded at and are made for children aged 2-7.
The first of the teddies will be handed out to children in need at Tauranga Hospital from today.