Drawn up by Interior Minister Nicolas Sarkozy who says he wants France to "choose" rather "undergo" the process of immigration, the law favours skilled workers by offering renewable residence permits to highly-qualified newcomers from outside the European Union.
The bill, passed by 367 votes to 164, has prompted a strong hostile reaction from the left-wing opposition, rights groups, the Catholic church and some African countries, some who describe the law as racist.
Critics say the law risks creaming off the most talented people from countries where they are badly needed, and will make life harder for ordinary migrants.
A Socialist MP has been quoted as describing the bill as "the organised pillaging of brains", and the council of Christian Churches has written to the government to express its concern.
"Keeping the best and sending back the worst is not exactly Christian," said Cardinal Philippe Barbarin, Archbishop of Lyon.
But Mr Sarkozy said the move brings France into line with other countries that have selective immigration.
Tighter rules
The law creates a new type of residence permit -- a "skills and talents permit" -- open to foreigners with qualifications which are judged to be important for the French economy and labour market.
At the same time rules, are tightened for migrants moving to France for family reasons, as the vast majority currently do.
Foreigners will be allowed in only if they can be supported by earned income and not from state hand-outs.
Foreign spouses will have to wait longer for residence cards, in a bid to crack down on marriages of convenience, and migrants will sign an "integration contract" committing them to respect the French way of life and to learn to speak French.
The bill is set to be debated in the upper house or Senate in June ahead of final approval.
Ivorian reggae singer Alpha Blondy said: "This notion of chosen immigration, this migratory apartheid takes us back to the time of slavery, when the traders chose the strongest or those with the best teeth to take them to the west."
Mr Sarkozy, who is a frontrunner to become French president after next year's elections, left France on Wednesday to visit Mali and Benin, where he faces protests from those opposed to the law.
He said riots in November in suburbs dominated by immigrants shows that France's current system of immigration is not working.
"We are closing the doors to those who have a job and opening it for those who don’t. This absurd system is an essential ingredient in our malaise," he told parliament.
Around 4.4 million foreign nationals live in France, according to the most recent figures, and every year another 140,000 enter through legal channels, as well as an estimated 90,000 illegal arrivals.
Mr Sarkozy said only five percent of those entering the country legally do so for work reasons.
In an open letter, he rebutted the slavery comparison made by reggae singer Blondy, who is a UN "messenger of peace" for the Ivory Coast.
"African slavery was one of the worst tragedies of history and it is essential not to trivialise this crime against humanity by inapt comparisons.
Chosen immigration means regulated immigration, organised with reference to the reception capacity of our country," he said.