Police controlled the intersection for a couple of hours in the morning and contractors continued as the fault was addressed.
Garry de Thierry, principal of nearby Rotorua Intermediate School, said student safety was paramount so they made sure children were able to get across safely.
"I noticed the lights were out at 7.15am," Mr de Thierry said.
"Old Taupo Rd is always so busy and there are four schools in that area so there is a lot of young pedestrian traffic.
"It was a concern of ours so we sent a couple of staff to help them cross."
He said the students had suggested having diagonal crossings in place at peak times so they did not have to wait for two sets of lights to cross safely.
"As adults we bear with it but it's the students who have to walk that path every day, they're the ones who come up with some good ideas."
Rotorua police spokesman Nicky Riordan said it was a main thoroughfare so officers were there to make sure traffic flowed safely.
"We had no major issues. Our job is to make sure people are safe on the roads and while we don't want to be tied up for hours, sometimes we need to do that."
The lights belong to the New Zealand Transport Agency (NZTA) but maintenance is contracted to Rotorua Lakes Council.
"Some of the traffic lights in the city are nearing the end of their functioning life and the transport agency has set aside $400,000 for upgrades in the 2015/2016 financial year," said NZTA Highways manager Niclas Johansson.
Readers on the Rotorua Daily Post Facebook page commended police and traffic management for controlling traffic throughout the day.
"The police are doing a great job of managing the traffic today. Those lights need to be replaced," wrote one reader.
"This happens almost twice a month," wrote another.