The 15-0 vote marks the second unanimous decision against North Korea in the weeks since it unexpectedly tested intercontinental ballistic missiles and an apparent hydrogen bomb.
After late-night negotiations Sunday with China, the U.S. delegation broadly weakened a sanctions proposal that Beijing was unwilling to support. China's cooperation is key to enforcing any sanctions.
The move shows the continued division among major world powers as they grapple with a government that has repeatedly defied U.N. resolutions.
The initial U.S. resolution had included a ban on oil exports to North Korea, which would have severely crippled the isolated nation's economy, and a freeze on the personal assets of its leader, Kim Jong Un.
But as China and Russia made their opposition known, U.S. diplomats backed down, agreeing to gradually reduce, instead of ban, oil exports to Pyongyang.
Exports of refined oil to North Korea will be cut in about half, to 2 million barrels annually, according to a U.S. diplomat involved in the talks.
The proposed freeze of Kim's assets abroad was dropped altogether.
"It's a negotiation," the U.S. official said. "That's where we landed."
The official, who briefed reporters on condition of anonymity, in keeping with State Department practices, said it was unlikely the North Korean leader had bank accounts, properties or other assets hidden overseas that could be seized.
The United States also stepped away from insisting that the U.N. authorize use of military force to interdict North Korean vessels at sea that are suspected of smuggling banned components for its nuclear or ballistic missile programs.
The U.S. side also backed off its proposal to require all countries to expel North Korean guest workers. Tens of thousands of North Koreans work in Asia and the Middle East and send most of their earnings to the government in Pyongyang, a major source of the country's foreign exchange.
The new resolution calls for firing 93,000 North Korean workers employed overseas when their contracts expire.
A U.N. ban on the export of North Korean textiles, one of the country's fastest growing industries, stayed in the resolution. Textile exports netted $726 million last year for Pyongyang.
Combined with previous sanctions, the official said, 90% of North Korea's declared exports, including seafood, coal and textiles, will be embargoed.
He said he was confident that China and Russia were on board with the resolution, which he characterized as a "major step in increased pressure."
Others saw the move as more incremental than substantial.
In August, the Security Council unanimously approved a resolution to impose sanctions intended to cut annual North Korean export income by a third, or $1 billion.
It is not clear how much of that has been realized, and how much of the current measure replicates some of those cuts.
So far, sanctions have done little to slow North Korea's relentless progress in developing nuclear arms.
The Trump administration has repeatedly called on China, North Korea's main trading partner and political ally, to put more pressure on Kim to refrain from further testing of nuclear and ballistic missiles.
Beijing's willingness to do so has been spotty, and even when it has called on North Korea to stand down, Kim has gone ahead with missile tests.
The United States and China "have two fundamentally different purposes," said Joseph Cirincione, president of the Ploughshares Fund, a San Francisco-based organization that promotes nuclear nonproliferation.
"The United States is looking for some sort of sanctions that will bring North Korea to its knees," he said. "China does not want North Korea to collapse, but wants a stick to get it to the negotiating table. But the U.S. doesn't want to go to the negotiating table."
In July, after Pyongyang warned it might fire missiles toward Guam, President Trump threatened to rain "fire and fury" on North Korea. He later said the U.S. military was "locked and loaded," as if ready to attack the nuclear armed nation.
Others in the administration have pushed for diplomatic openings. Secretary of State Rex Tillerson has suggested the possibility of dialogue — but only if Pyongyang first agrees to freeze its nuclear program.
South Korean officials were offended when Trump criticized its official approach of engagement with its northern neighbor as "appeasement."
"There are many elements to consider beyond the military and strategic value of this issue," South Korean Foreign Minister Kang Kyung-wha said during a news conference in Seoul on Monday.
She said they included nonproliferation and the denuclearization of the Korean peninsula.
Last week, after North Korea conducted its sixth and most powerful nuclear test, Nikki Haley, the U.S. ambassador to the United Nations, called for the toughest possible sanctions. She said North Korea was "begging for war."
For its part, Pyongyang issued its own threat Monday before the U.N. vote.
The United States is attempting to "strangle and completely suffocate" North Korea, the country's Foreign Ministry said, and Pyongyang "shall make absolutely sure that the U.S. pays due price."
Speaking after the vote, Haley said the resolution "builds on what are already the deepest sanctions" imposed on North Korea.
But given its growing threat to the United States, "We are no longer trying to get North Korea to change its behavior, we are stopping it from [exercising] its behavior," she said.
The British ambassador to the U.N., Matthew Rycroft, said the resolution showed the Security Council's "determination to act."
"Make no mistake: We are tightening the screw, and we stand ready to tighten it further," he said.