"I am so excited with this announcement to bring the LPGA to my hometown in Auckland," said Ko.
"I am honoured to be the first player to sign up to play. It is going to be amazing for me and my family to host my LPGA friends in my country. I want to see golf grow in New Zealand and more women playing the game, so this news today is fantastic."
The women's national Open has long superceded its men's equivalent, largely due to Ko's attendance. For the past four years it has been at Clearwater in Christchurch in front of impressive crowds, with Ko dominating for three victories.
It's the biggest announcement in the sport in New Zealand since Tiger Woods played the national men's open in 2002.
"New Zealand Golf is thrilled with the boost for golf and the golf industry in this country and for the women's game in particular," said New Zealand Golf CEO, Dean Murphy.
"Inbound golf tourism brought in $329 million to New Zealand in the year ended August 2016, which was a 23 per cent increase over last year.
"The LPGA international platform will allow Auckland and New Zealand a unique opportunity to promote ourselves to a worldwide audience in over 150 countries with over eight hours of television coverage.
"We have a chance to show off our great golf courses in this country to a massive global audience and build on the investment in golf infrastructure and tourism. Bringing the major women's golf tour to this country will provide an unprecedented opportunity for all golfers and sports fans to watch some of the game's best players in action, as well as excite young kids to take up the sport. And it gives us a chance for Lydia to play in an LPGA event here at home."