The new sanctions resolution on Wednesday, which was spearheaded by the United States and came after three months of tough negotiations with fellow veto-wielding council member China, passed by a 15-0 vote.
The resolution demands that North Korea "abandon all nuclear weapons and existing nuclear programmes" and takes aim at the state's exports of coal - its top external revenue source.
Under the resolution, North Korea will be restricted from exporting beyond 7.5 million tonnes of coal in 2017, a reduction of 62 percent from 2015.
Samantha Power, the US ambassador to the United Nations, said the resolution would strip the regime of more than $700m in hard currency, dramatically reducing the money it can spend on nuclear and ballistic weapons.
Power, speaking to reporters with her counterparts from US allies South Korea and Japan, called the resolution "the strongest sanctions regime the Security Council has imposed on any country in more than a generation".
"So long as the DPRK makes the choice it has made, which is to pursue the path of violations instead of the path of dialogue, we will continue to work to increase the pressure and defend ourselves and allies from this threat," said Power, referring to the North by its official name, the Democratic People's Republic of Korea.
China joins in pressure
UN Secretary-General Ban Ki-moon urged all countries to enforce the resolution.
"It sends an unequivocal message that the DPRK must cease further provocative actions and comply fully with its international obligations," said Ban, who has flirted with entering politics in his native South Korea after his term ends in a month.
Ban said he was still committed to "sincere dialogue" to resolve the nuclear issue and stood by calls to provide humanitarian assistance to ease the suffering of ordinary North Koreans.
China is North Korea's primary ally and one of the few markets for its coal.
China has traditionally protected North Korea diplomatically, believing that Kim Jong-un's regime is preferable to its collapse, but has increasingly grown frustrated by the neighbouring state's defiance.
China's UN ambassador, Liu Jieyi, reiterated that Beijing "strongly opposes" the North Korean nuclear tests - but also made a veiled criticism of joint military exercises between the United States and South Korea.
"Certain parties increase their military presence and scale up military exercises, thus intensifying the confrontation," he said at the council. "This situation must be changed as soon as possible."
The UN Security Council resolution condemns "in the strongest terms" North Korea's nuclear test on September 9 - the communist state's second just this year.
Pyongyang claimed at the time it had made major strides in its efforts to fit a miniaturised warhead on a rocket that could reach the United States.
North Korea insists its nuclear weapons are a deterrent to US "aggression" and has brushed aside earlier sanctions, which have notably targeted its weapons exports and access to financial markets.
In addition to coal, the Security Council banned North Korea from exporting certain metals including copper, silver, zinc, and nickel that bring in an estimated $100m a year, as well as statues and helicopters.
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