The law should make the situation clearer for foreign investors
Russia will start restricting foreign investment in key sectors of the economy such as energy and aviation.
Russian President Vladimir Putin signed the law just days before his successor, President-elect Dmitry Medvedev, is set to be sworn in.
Investors have complained that the law limits access to more than half of Russia's economy.
However analysts have said the law should make the situation clearer for companies wanting to invest in Russia.
State-run firms, such as energy firm Gazprom, have at times taken control of assets at the expense of foreign investors.
The law lists 42 sectors where foreign investment will be limited including nuclear energy, natural monopolies, exploration of strategic mineral deposits, aviation, space and other sensitive industries.
Any private-sector foreign company wanting to buy more than 50% of a firm in a sector deemed strategic will need authorisation from a commission made up of economic and security officials.
Companies controlled by foreign governments will have to go through the same procedure if they plan to acquire more than 25% of a Russian company on the list.