The resolution would also allow member states who suspect ships carrying suspect material to North Korea to direct the vessels to "an appropriate and convenient port for the required inspection by the local authorities".
A vote on the resolution could come as early as Friday.
Susan Rice, the US ambassador to the UN, described the draft as a "strong response" to North Korea's nuclear test.
"This sanctions regime, if passed by the Security Council, will bite, and bite in a meaningful way," Rice said.
She added that a total ban on North Korean arms exports, as called for in the draft, would cut off a significant source of revenue for Pyongyang.
Tensions have risen in recent weeks after North Korea carried out a nuclear test, launched missiles and threatened to attack South Korea.
The US and Japan have pushed for strong sanctions to punish North Korea, but China and Russia had been cautious, apparently nervous about provoking Pyongyang.
Al Jazeera's John Terrett, reporting from New York, said frantic negotiations had taken place over the last two weeks aimed at convincing Russia and China to back the expanded sanctions against North Korea.
The two nations had refused to back a draft that required searches of North Korean ships suspected of carrying weapons material, and instead agreed to a call for searches.
Vitaly Churkin, the Russian ambassador, had raised concerns about the move to broaden the sanctions by 35 points, but later said the set of proposals was balanced, our correspondent said.
And Al Jazeera's Tony Cheng, reporting from Beijing, said the Chinese were very much agreed on the draft resolution as they were keen to show the North Korean government how displeased they were over Pyongyang's recent nuclear test.
But while the new sanctions would send a message to Pyongyang, the reality was that the North is already very isolated and it is very hard to further isolate a country that is already cut off, our correspondent added.
North Korea warned on Wednesday it would use its weapons if provoked – an apparent effort to deter international punishment for its test of a nuclear device last month
"Our nuclear deterrent will be a strong defensive means ... as well as a merciless offensive means to deal a just retaliatory strike to those who touch the country's dignity and sovereignty even a bit," said a commentary in the state-run Mink Jason newspaper.
North Korea launched a long-range missile in April, triggering condemnation from the UN Security Council.
Pyongyang then announced on May 25 that it had staged a second nuclear weapons test, following one in 2006.
It also has declared the armistice ending the 1950-53 Korean War was void.