Background New Zealand has a goal of becoming a smokefree nation by the year 2025. Smoking prevalence in 2012 was 17%, but is over 40% for Māori (indigenous New Zealanders). We forecast the prevalence in 2025 under a business-as-usual (BAU) scenario, and determined what the initiation and cessation rates would have to be to achieve a <5% prevalence. Methods A dynamic model was developed using Census and Health Survey data from 1981 to 2012 to calculate changes in initiation by age 20 years, and net annual cessation rates, by sex, age, ethnic group and time period. Similar parameters were also calculated from a panel study for sensitivity analyses. ‘Forecasts’ used these parameters, and other scenarios, applied to the 2011–2012 prevalence. Findings Since 2002–2003, prevalence at age 20 years has decreased annually by 3.1% (95% uncertainty interval 0.8% to 5.7%) and 1.1% (−1.2% to 3.2%) for non-Māori males and females, and by 4.7% (2.2% to 7.1%) and 0.0% (−2.2% to 1.8%) for Māori, respectively. Annual net cessation rates from the dynamic model ranged from −3.0% to 6.1% across demographic groups, and from 3.0% to 6.0% in the panel study. Under BAU, smoking prevalence is forecast to be 11% and 9% for non-Māori males and females by 2025, and 30% and 37% for Māori, respectively. Achieving <5% by 2025 requires net cessation rates to increase to 10% for non-Māori and 20% for Māori, accompanied by halving or quartering of initiation rates. Conclusions The smokefree goal of <5% prevalence is only feasible with large increases in cessation rates.