Chief District Court Judge Jan-Marie Doogue said the peer reviews wouldn't assess decisions of individual judges. "This is a health check on the district courts,"she said.
Ten areas of courtroom operation would go under the microscope. They included the time it takes judges to make judgments, giving reasons for decisions, workloads, rostering decisions, public communication and complaints.
Some of the changes are the result of mounting concern from the public and lawyers.
The report cited the high-profile murder of Auckland teenager Christie Marceau and the publicity generated after it was revealed her killer, Akshay Chand, was out on bail when he killed her.
The discussion paper suggested the public should know the reasons for judges' decisions.
"It is imperative that the judiciary therefore takes initiatives to put information about their decisions, both judicial and administrative, into the public arena," it said.
There was also a lack of confidence over judges taking too much time to make reserved decisions.
Sensible Sentencing Trust spokesman Garth McVicor said he wasn't surprised at the move as the judiciary was under increasing pressure to be transparent. He hoped this would bring a mood of openness to the judiciary and praised Doogue for the initiative.
Doogue said there was widespread backing for the review from within the judiciary. The Ministry of Justice would be approached to fund the next stage, she said.