"He also spoke of enriching the lives of others. I am deeply moved," Hotere said.
Hotere Foundation chairwoman Judith Ablett Kerr said the honour was "the ultimate endorsement" of his contribution to the art world, to New Zealand and New Zealanders.
"Ralph's career spans over 50 years and reflects his intense spiritual interest in humanity and environment," the Queen's Counsel said.
"Through his art, Ralph has remained outspoken about issues that trouble the world and that outspokenness continues even today some 10 years after he suffered a debilitating stroke."
The honour was a fitting end to the year Hotere celebrated his 80th birthday with exhibitions throughout the country.
This month, he completed an artwork for his Christchurch printer, Marion Maguire, to show support for the city.
The citation for the New Year honour said that as a painter, sculptor and collaborative artist, Hotere had reacted to social and environmental issues through his work.
It is dominated by black, both in colour and in the artworks' titles, and makes extensive use of words, often quoting poets and his conversations with them.
He has dealt with key New Zealand historical events such as the Springbok tour, the Rainbow Warrior sinking and the Aramoana massacre.
Order of NZ
For services to New Zealand: Ralph Hotere.
