Many of the committee members were in favour of the night market being extended, including mayor Steve Chadwick who said it was a "marvellous idea" and councillor Charles Sturt who said it was a "brilliant concept".
"The very nature of retail is changing and I think this is a natural progression," Mr Sturt said.
The market will be extended south down Tutanekai St to the block bordered by Hinemoa and Pukuatua Sts.
Councillor Karen Hunt, who leads the Inner City Portfolio, said it was a "really exciting proposal".
"I know there are shops on the other side of City Focus who are planning to stay open on the night of the market. Now we have made the decision to remove the sails and pillars, it will be very clear when the night market is on.
"This is a great, positive step, it is something unique and different and we are leaders in the country for night market provision."
The expansion is expected to be a cost neutral operational project.