New York will become the sixth and most populous state in the United States to allow gay marriage after senators voted 33-29 to approve the move.
After Governor Andrew Cuomo signs the bill into law, same-sex weddings can begin in 30 days.
Cheers erupted in the Senate gallery in the state capital Albany and among a crowd of several hundred people who gathered outside New York City's Stonewall Inn, where riots following a police raid in 1969 sparked the modern gay rights movement.
Religious institutions and non-profit groups with religious affiliations will not be compelled to officiate at such ceremonies.
The state-by-state battle over gay marriage has become a contentious American social issue ahead of the 2012 presidential and congressional elections.
New York's Catholic bishops said they were "deeply disappointed and troubled" by the passage of the bill.
"We always treat our homosexual brothers and sisters with respect, dignity and love. But we just as strongly affirm that marriage is the joining of one man and one woman," the New York State Catholic Conference said in a statement.
But New York City Mayor Michael Bloomberg, an advocate for gay marriage who lobbied state lawmakers in recent weeks, said the vote was an "historic triumph for equality and freedom."
