The Department of Conservation says it is spread too thin, and its work is being curtailed by a lack of funding.
During its annual review, presented to Parliament's environment committee on Thursday morning, director-general Penny Nelson told the committee more than 4000 species were threatened or at risk of extinction, and many more lack data.
"The department is not currently financially sustainable for what we're being asked to do," she said.
The warning comes as environmental groups warn the government's fast-track legislation is an "unprecedented assault on nature and democracy".
The National government intends to cut the Department of Conservation's budget by 6.5 percent, and Nelson said it would be looking for direction from ministers about what to prioritise later this year.
"One option is we keep doing what we're doing, another is we do less, another is that we try and get greater conservation outcomes."
She said the money going into the department made up 0.44 percent of government spending - spread evenly across DOC-managed land and water, that gave them $56 dollars per hectare to work with.
"Over the last decade, DOC's role and the expectations of us have increased, but there's never been a comprehensive look at what is our role, and what's the funding that you need to have to address that role."
"We're spread too thin," Nelson said. "We can't do everything everywhere. We need to get smarter and prioritise."
There were things to be proud of, Nelson said - this year they had a bumper kākāpō breeding season and more than 90 percent of facilities were back open following Cyclone Gabrielle.
But visitor numbers were returning to pre-Covid-19 levels, leading to congestion in DOC facilities and national parks and impacts on nature.
Pest numbers were also increasing and, given all those factors, the department was struggling to keep up.
Nelson said their funding only stretched to cover the use of 1080 on 7.5 percent of public conservation land, and warmer weather was increasing the fruit yields in forests - providing more food for pests such as rats and stoats.
Weed control was being compromised in order to deal with such animal pests.