Amid worry that the chaos is drawing in other Arab nations, the council unanimously adopted a resolution making groups and individuals subject to economic sanctions for actions that "threaten the peace" or "obstruct the successful completion" of attempts to set up an effective government in Libya.
Western and Middle Eastern countries have been looking for new ways to halt fighting that has left the north African country a semi-lawless state, a terrorist haven and a regional hub of drug and arms trafficking.
The resolution, drafted by Britain, stops short of imposing sanctions, hoping instead to scare warlords into compliance by redefining who could be hit with penalties.
Advocates of sanctions argue that they could be effective, because militia leaders have strong banking, trade and family ties to Europe.
Sanctions imposed on Libya have previously been aimed more at associates of former leader Moammar Kadafi.
The Obama administration and European allies have been looking for ways to stabilize the country since a North Atlantic Treaty Organization air war helped insurgents oust Kadafi in 2011.
Another idea under consideration is the creation of an international armed force to help the new government and protect it from attack.