Director James Cameron has purchased a patch of untouched land in New Zealand for $US16 million ($A15.32 million).

The area, which features a freshwater lake, contains 1011 hectares of farmland in Pounui Ridge, roughly 32 kilometres from Wairarapa Valley wine town on North Island, where Cameron and his family hope to grow several crops.

The Titanic director plans to settle down there and eventually begin work on the upcoming Avatar sequels, which will be filmed at Peter Jackson's studios, where each of the Lord of the Rings films were completed.

But Cameron says Jackson has nothing to worry about, telling the New York Times, "I'm not there to compete with Peter."

And the Oscar winner, who first grew attached to the country while plotting an expedition to Antarctica from South Island nearly two decades ago, says he is even considering applying for citizenship, adding, "I've felt an attachment to the place since 1994."