Teina Pora has instructed his lawyers to file papers in the High Court, challenging the government's decision not to add inflation to his $2.5 million compensation package.
The payout was offered by the government last month after Mr Pora spent nearly 22 years in prison for the 1992 murder and rape of Susan Burdett in Auckland - crimes he never committed.
His compensation was based on 1998 guidelines that award $100,000 a year for loss of liberty.
An independent report had recommended the figure be adjusted for inflation but the government rejected that.
Mr Pora's lawyer, Jonathan Krebs, confirmed he had received instructions from his client to file papers in the High Court, seeking a judicial review of the government's decision.