Lawmakers yesterday voted in favor of the bill by 94 votes to 27.
Prime Minister John Key welcomed the result, saying in a statement that the government was enhancing domestic security as well as responding to the rapidly evolving threat posed by New Zealanders fighting abroad.
The law will allow the nation's domestic spy agency to carry out surveillance for up to 24 hours without a warrant. It also increases the amount of time the government can cancel a passport on national security grounds from one year to three years.
New Zealand has had few terrorist incidents in its history.
But Key recently said government agencies have a watch list of between 30 and 40 people who it says are engaged in extremist behavior. He said some had traveled to Syria to engage in fighting with the Islamic State group, some had tried to travel but failed, and some were suspected of funding terrorism.
