A judge has imposed a $1m (£570,000) per day fine on New York's main transport union for a strike that has brought city transport to a standstill.
Commuters braved freezing temperatures to make it to work
The 34,000 members of the Transport Workers Union went on strike after talks over their contracts collapsed.
They say they are "tired of being underappreciated" but transport bosses accuse them of "bullying tactics".
Mayor Michael Bloomberg joined many in walking to work, warning the strike could cost up to $400m a day.
Public sector workers are banned from striking under New York state law, and lawyers had requested a severe penalty in an effort to deter the union from a lengthy strike.
Brooklyn-based judge Theodore Jones ordered the union to pay $1m for each day the strike continues.
'Enough is enough'
Mr Bloomberg denounced the strike as a "cowardly attempt" by the union to improve its bargaining position with management.
He asked the seven million people who normally rely on the subway and buses to make car pool arrangements, cycle or walk to work, or work from home.
"We cannot let inconveniences, as massive as they are, stop our economy, shut down our schools or jeopardise public safety," he said.
Under the emergency measures, cars carrying fewer than four passengers were being turned away at bridges and tunnels into Manhattan.
Huge queues formed at commuter buses, trains and ferries that were still running. Some Wall Street firms had laid on shuttle buses.
One commuter, Joy Bennett, said the strike had enabled her to travel to work above ground for the first time. "This is beautiful," she said, walking through Time Square before dawn.
But many commuters showed little sympathy for the strikers.
"Enough is enough," said Craig DeRosa. "Their benefits are as rich as you see anywhere in this country and they are still complaining. I don't get it."
Meanwhile, the striking transit workers took to the picket lines with signs saying "We move NY. Respect Us!"
Contract talks between the TWU and the state-run Metropolitan Transportation Authority (MTA) broke down shortly before a midnight deadline.
They are in dispute over wage rises, health-care and pension costs and the retirement age of employees.
The union argues that cutbacks in benefits are unnecessary as the mass transit system has a $1bn surplus, which the MTA says is for essential reinvestment.
"Transit workers are tired of being underappreciated and disrespected," TWU chief Roger Toussaint said.
MTA says it put a fair offer on the table, and chairman Peter Kalikow called the union action a "slap in the face" for all New Yorkers.
Their lawyers immediately asked for an emergency court hearing to seek a contempt of court ruling against the union.
The strike violates a state law that prohibits public employees from walking out, and the unions and its members could face huge fines.
This is the first mass transit walkout in New York since an 11-day strike in 1980, which was calculated to have cost the city billions of dollars.