The "run-it-straight challenge" has gone viral on social media across New Zealand and Australia, attracting huge crowds to events where participants charge each other head-on with no protective gear.
A 19-year-old died from a "serious head injury" in New Zealand's North Island after playing the game with friends over the weekend, New Zealand Police said in a statement.
"The man suffered a serious head injury when tackled and was taken to hospital by friends," police inspector Ross Grantham said.
"Tragically, he passed away in hospital on Monday night.
"We would urge anyone thinking about taking part in a game or event like this to consider the significant safety and injury risks."
Organised run-it-straight competitions offer thousands of dollars in prize money and have drawn interest from ex-professional rugby players.
Experts have likened the game to a combat sport, warning that participants face serious concussion risks.