The UN Security Council has unanimously adopted Resolution 2270, imposing sanctions on North Korea.
The resolution includes mandatory cargo inspections, prohibitions on aviation fuel, rare minerals and embargo on weapons trade with Democratic People's Republic of Korea (DPRK).
It also bans the import of luxury watches, Jet Skis and snowmobiles from the South Asian country.
The resolution is said to be the toughest set of sanctions enforced by the council in more than two decades.
US State Secretary John Kerry said: "I welcome the unanimous adoption today of UNSC resolution 2270 on North Korea, which reflects the firm and united resolve of the international community to address Pyongyang's continued defiance of its international obligations and commitments.
"Today's action, and the international consensus it represents, will hold the regime to account for its increasingly provocative behaviour and the threat it poses to not only security on the peninsula, but also to the world.
"With this resolution we renew our collective resolve to take concerted action to counter this threat posed by North Korea's proscribed programmes and proliferation activities worldwide."
The move follows the recent launch of a North Korean missile claimed to be an earth observation satellite, which violated the UN protocol.
Japan also expressed solidarity with the decision.
Japanese Prime Minister Shinzo Abe was quoted by Japan Times as saying: "We rate highly the unanimous adoption of Security Council resolution 2270 drastically augmenting and strengthening sanctions in response to North Korea's nuclear test in January and ballistic missile launch in February."
North Korea has reportedly fired six short-range projectiles from Wonsan into the East Sea as a response to the resolution.