It will allow the authorities to confine suspected jihadist sympathisers to their neighbourhoods, close places of worship accused of condoning terror and carry out more on-the-spot identity checks -- all without the prior approval of a judge.
The legislation has encountered little resistance from a public traumatised by a string of jihadist attacks, despite criticism it will undermine civil liberties.
The bill was approved on its first reading in the lower house of parliament by 415 votes to 127, with 19 abstentions.
It is expected to become law before the state of emergency declared after the 2015 Paris attacks elapses on November 1 after being extended six times.
Since 2012, France has progressively tightened its legal arsenal to tackle terror threats, passing around 10 different laws.
"The concentration of powers in the hands of the executive and weakening of judicial oversight is not a new characteristic of France's counter-terrorism efforts," said Benedicte Jeannerod, France director for Human Rights Watch.
"But the normalisation of emergency powers crosses a new line."
Tuesday's vote comes after more bloodshed this weekend, when a suspected Tunisian radical stabbed two 20-year-old women to death in the Mediterranean port city of Marseille.
The attack by 29-year-old Ahmed Hanachi, who was shot dead by troops on anti-terrorism patrol, brings to 241 the number of people killed in attacks claimed by, or attributed to, jihadists since January 2015.
- 'State of war' -
"We're still in a state of war," Interior Minister Gerard Collomb told parliament Tuesday, warning of a "very serious threat" level.
Rights groups have countered that the state of emergency did not prevent a string of attacks in the past two years.
On Monday, anti-discrimination group SOS Racisme demonstrated outside parliament against provisions that will allow police to carry out more spot ID checks.
"People who are supposedly foreigners, black or north African will be stigmatised," Thierry Paul Valette, head of another anti-racism group, Egalite Nationale, told the Liberation newspaper.
UN experts also raised objections in a letter to the French government last week.
But a poll published by the conservative Le Figaro newspaper last week showed 57 percent of the French in favour.
- 12 foiled attacks -
The Islamic State group, which is fast losing territory across the remaining parts of its self-proclaimed caliphate in Iraq and Syria, has claimed several recent attacks in France as the work of its devotees, including the Marseille assault.
Under the anti-terror bill, which was passed by the upper house Senate in July, the police will have powers to expand border controls to areas around international train stations, ports and airports.
It also allows the authorities to shut down a mosque or other place of worship if preachers are found to promote radical "ideas and theories".
Marine Le Pen, the leader of the far-right National Front who ran a failed presidential bid, complained Tuesday that the law did not go far enough in combatting the "Islamist ideology that is waging war on us".
Ex-president Francois Hollande declared a state of emergency after the wave of bombings and shootings at Paris nightspots and France's national stadium in November 2015, in which 130 people were killed.
It was meant to be temporary but was repeatedly extended in order to protect major sporting and cultural events, as well as this year's presidential and parliamentary elections.
The government says it has helped foil 12 planned attacks so far this year.