The law aims to punish Syria for alleged ties to terrorists, its tacit support for insurgents in Iraq and alleged efforts to obtain weapons of mass destruction.
"The partisans of Israel in the American Congress worked actively for the adoption of this law," the official SANA news agency said in the first reaction from Damascus to US President George Bush signing the bill into law on Friday.
The statement added, "Israel wants more than anything for Syria to end its support for the resistance of the Palestinian people."
The bill demands that Syria end support for terrorism halt the development of chemical and biological arms as well as medium- and long-range missiles and withdraw the 20,000 troops it has deployed in Lebanon.
It also calls on the governments of Lebanon and Syria to "enter into serious unconditional bilateral negotiations" with Israel in order to secure "a full and permanent peace".
The bill says Syria must close its borders to any military equipment and anti-US fighters bound for Iraq, where US-led occupation forces have been coming under deadly attacks since ousting Saddam Hussein in April.
The legislation directs the president to prohibit US weapons exports to Syria and so-called "dual-use" technology with
both civilian and military applications.
Other measures provide for restricting US exports and business investment, downgrading US-Syrian diplomatic ties, imposing travel restrictions on Syrian diplomats in the United States, freezing Syria's assets in the United States and restricting overflight rights for Syrian aircraft inside US airspace.
Earlier this month, Syrian President Bashar al-Assad told the New York Times his government had helped the United States block at least seven terrorist attacks on American targets.
He also denied that Syria sponsored terrorism or that his country considers the United States as an adversary. He said Syria did not sponsor terrorist organisations, and that its support for Lebanon's anti-Israeli group Hizb Allah was political and did not involve arms or money.