We present a far-infrared galaxy luminosity function for the local universe. We have obtained 389 spectroscopic redshifts for galaxies observed at 90 μm in the AKARI Deep Field-South, using the AAOmega fibre spectrograph via optical identifications in the digitized sky survey and 4-m class optical imaging. For the luminosity function presented in this paper, we have used those galaxies which have redshifts 0< z< 0.25, have optical magnitudes and are not part of a newly discovered cluster of galaxies (giving a total of 130 sources). Infrared and optical completeness functions were estimated using earlier Spitzer data and automated plate measurement (APM) B-band optical data, respectively, and the luminosity function has been prepared using the 1/V max method. We also separate the luminosity function between galaxies which show evidence of predominantly star-forming activity and predominantly active galactic nucleus (AGN) activity in their optical spectra. Our luminosity function is in good agreement with the previous 90-μm luminosity function from the European Large Area Infrared Space Observatory (ISO) Survey, and we also present a luminosity function with combined AKARI and ISO data. The result is in reasonable agreement with predictions based on the earlier Infrared Astronomical Satellite (IRAS) m PSCz catalogue, and with a recent backward evolution model.