England, chasing a record 455 to win, lost four wickets in the first hour and the dismissal of Ben Stokes late in the session completed an excellent morning for the touring side.
Captain Alastair Cook was unbeaten on 40 at the interval with Jos Buttler on nought.
England resumed on 44 for no wicket and Adam Lyth failed to add to his overnight score of 24, feathering a swinging ball from paceman Trent Boult through to wicketkeeper Luke Ronchi.
Gary Ballance unconvincingly negotiated 25 deliveries for six runs before Boult produced a venomous full delivery that crashed into the left-hander's stumps.
Ian Bell, on one, turned a bouncing ball from spinner Mark Craig straight into the hands of Kane Williamson at leg-slip and Joe Root was brilliantly caught off Craig for a second-ball duck by Tom Latham at short leg.
With England's slim hopes of victory all but over, Cook and Stokes adopted a cautious approach, although the all-rounder produced a couple of trademark crisp boundaries to entertain a sparse crowd on a chilly day at Headingley.
The pair added 40 for the fifth wicket before Stokes was out for 29, caught by Ronchi as he attempted an ambitious cut off part-time spinner Williamson.
England won the first Test at Lord's by 124 runs. – Reuters
Original source: NZ bowlers leave England reeling